Factors Affecting Customer Satisfaction towards Online Shopping

Factors Affecting Customer Satisfaction towards

Online Shopping

Haslinda Musa1, Mohd Amin Mohamad1, Fararishah Abd Khalid1, Namirah Ab

Rahim1, Nur Najihah Ahmad Zamri1

1Fakulti Pengurusan Teknologi dan Teknousahawanan

Universiti Teknikal Malaysia Melaka (UTeM), 76100 Durian Tunggal,

Melaka,

Malaysia

[email protected]

Abstract

Nowadays people are intended to do online shopping. Shop on the

Internet becomes an alternative for consumers since it is more

comfortable than conventional shopping which usually attributed with

anxious, crowded, traffic jam, limited time, parking space and etc.

Internet in Malaysia is still considered as a new medium tool between

the retailers and the consumers, and also retaining customers on e-

retail is the most issue that are faced by any e-retail store. Because

of that, the research is to study the factors affecting customer

satisfaction towards online shopping among university students. There

are three factors contributed to this research, which are product

quality, brand, and shopping experience. This research was used a

survey method of distributing questionnaires to 150 respondents.

Questionnaires will be distributed among university student to gauge

their factors to shop online. The researcher used online survey and

manual method to collect data. The data that has been collected was

analyzed by using Statistical Package for Social Science (SPSS) and

Microsoft Excel. Based on the research, the product quality, brand and

shopping experience have a significant relationship to customer

satisfaction towards online shopping among university students at

UTeM.

Keywords: Brand, customer satisfaction, online shopping, product

quality, shopping experience

INTRODUCTION

Internet usage has grown rapidly over the past several years and

it has become a common means for delivering and trading information,

services and goods. The use of the Internet has increased

exponentially over the past years and it has become a mainstream tool

in delivering and trading information, services and goods (Albarq,

2006). Moreover, internet technologies create marketplaces for

consumers to purchase product or services from online Web sites

instead of shopping in the traditional market channels such as

department stores (Zhuang & Babin, 2015). As such, the university

student still has various reservations about purchasing through the

Internet, except those who use it as informative, entertaining and

communication tools.

In Malaysia, Internet shopping is still new and customers are

less familiar and often more skeptical towards online shopping.

Furthermore, a high double digit percentage of Internet users in

Malaysia shopping online, motivated by price advantages, product range

and availability of reviews. Malaysian shoppers look for free

shipping, convenience and exclusive online deals offered by online

stores. Moreover, online shopping is encouraged by new E-Commerce

regulations adopted in 2013, aimed at protecting consumer rights and

preventing online fraud. Malaysia, internet shoppers are relatively

young, highly educated, having higher social status, and command a

more favorable financial position.

Considering that Internet shopping, is still at the early stage

of development, little is known about consumers’ attitudes towards

adopting this new shopping channel and factors that influence their

attitude toward (Haque et al., 2006). According to Jariah, Husniyah,

Laily and Britt (2004), with the expansion of educational services in

Malaysia, university students become one of the most important market

segments for two reasons; First, this group has money and shopping

interests. Second, this is the segment of the population that has the

potential of earning a greater income than other segments of the

population.

PROBLEM STATEMENT

In the new era of modern science and technology, peoples' life

becoming easier and more convenient than prior life. One of the

benchmark of modern science and technology, the internet has been

deeply into every aspect of people’s life. According to Central

Intelligence Agency (CIA, 2009), there were 15.355 million number of

users that access the internet in Malaysia. Up to June, 2012, the

number of internet users in Malaysia has reached 17.723 million, with

an increase of 2.368 million compared to 2009, which is 60.7% of the

population, according to International Telecommunication Union (ITU,

cited in Internet World Stats, 2012). Therefore, all of these

statistics proved that the electronic commerce has grown rapidly in

recent years.

However, surveys of online consumers continue to indicate that

many remain unsatisfied with their online purchasing experiences. One

of the important reason when customers do not have good and perfect

information about product quality, once they make an online purchase.

Differed from the traditional business, consumers may evaluate the

quality of products by looking or also may allow to touch or feel the

products. However, these traditional ways of searching product

information are not suit for online purchasing. Besides, the

increasingly crowded online space also raises the issue of retailer

visibility, defined as the extent of the presence of an online

retailer in the consumer’s environment (Drèze and Zufryden, 2004).

Just because of online retailer easily locate the stores on internet

by only a mouse click away, not at all are equally visible to the

consumers. In short, the research intended to investigate the exact

factors play in the relationship between product quality, brand,

shopping experience and customer satisfaction.

RESEARCH OBJECTIVES

The purpose of the present paper is to the factors affecting

customer satisfaction toward online shopping. The specific objectives

of this study are 1) to examine the relationship between product

quality and customer satisfaction among university students, 2) to

determine the relationship between brand and customer satisfaction

among university students and 3) to analyze the relationship between

shopping experience and customer satisfaction among university

students.

HYPOTHESIS DEVELOPMENT

Hypothesis 1

H0: There is no significant relationship between product quality and

customer satisfaction towards online shopping among university

students

H1: There is a significant relationship between product quality and


students

Hypothesis 2

H0: There is no significant relationship between brand and customer

satisfaction towards online shopping among university students

H2: There is a significant relationship between brand and customer

satisfaction towards online shopping among university students

Hypothesis 3

H0: There is no significant relationship between shopping experience

and customer satisfaction towards online shopping among university

students

H3: There is a significant relationship between shopping experience


students

LITERATURE REVIEW

Customer refer to the person who does the buying of the product

and satisfaction can refer to the person’s feelings of pleasure or

disappointment that results from comparing a product’s perceived

performance or outcome with their expectations. Customer satisfaction

refers to the degree a customer is happy about the quality of products

and services. In order to increase online shopping in Malaysia,

understanding customer online shopping satisfaction and factors

affecting this satisfaction when shopping online should be given

priority.

Product quality

Product quality refers to the group of features and

characteristics of a saleable good which determine its desirability

and which can be controlled by a manufacturer to meet certain basic

requirements. Most businesses that produce goods for sale have a

product quality or assurance department that monitors outgoing

products for consumer acceptability. Product quality means to

incorporate features that have a capacity to meet consumer needs

(wants) and gives customer satisfaction by improving products (goods)

and making them free of any deficiencies or defects. Customers are

satisfied when the perceived service meets or exceeds their

expectations. They are dissatisfied when they feel the service falls

below their expectations. Quality and customer satisfaction has

provided some insights into determining the levels of satisfaction for

product experience. The more quality information provided by the

online retailers, the better the decisions could be done

satisfactorily (Ludin & Cheng, 2014). Customer service and a positive

customer experience are critical to sales in the e-commerce

marketplace. Product quality is customers’ overall evaluation of the

excellence in the performance of the good or service (John, Mowen &

Michael, 1997).

Brand

Brand management in the twenty-first century has become almost

synonymous with building and managing customer relationships (Story &

Hess, 2010). A brand is similar to a living being: it has an identity

and personality, name, culture, vision, emotion and intelligence. All

these are conferred by the owner of the brand and needs to be

continually looked at to keep the brand relevant to the target it

intends to sell to. According to He, Li and Harris (2012),

satisfaction occurs when the performance of a brand meets the

expectations of the purchaser. Brand satisfaction refers to the

evaluation summary of direct consumption experience, based on the

different between prior expectation and the actual performance after

receiving the product.

However, brand satisfaction defined as the cumulative

satisfaction as overall consumer’s evaluation based on the consumer’s

total purchase and experience with a brand of product or service.

According to Chiu, Huang & Yen (2010), highly satisfied consumers tend

to reflect the brand personality traits by using some symbols related

to the brand as an expression of their attachment to that brand.

Similarly, consumers who trust a brand are willing to improve and

sustain an affective bond with the brand that makes them feel warm and

enjoyable.

Shopping experience

Nowadays, the shopping experience has become the most important

differentiating factor for retail companies. Previous research has

shown that when customers are satisfied with a company or service,

there is high possibility that they will share their experience with

other people (Nelson, 2012). For example, in Motorola company, the

retailers need to offer their customers the best possible customer

service as well as ensure a smooth transition between shopping on the

Internet and in the store if they want to provide a unique shopping

experience and resulting customer retention to ultimately increase

sales. Online shopping experience moderates the effect of the

perceived usefulness of behavioral intentions (Hsieh and Liao, 2011).

Frequency of purchases is positively related to the online shopping,

tendency and negatively related to the likelihood to abort an online

transaction.

A shopping experience is the cognitions and feelings the consumer

experiences during the use of a product or services. The customer

experience may provide a new means of competition (Robert & Xiangyu,

2011). According to Alam and Yasin, 2010, satisfied customers are most

likely to have the intention to repurchase if the service provider

reached or exceeded their expectation. Thus, the more experienced

consumers are with online shopping and the more satisfied they are

with past online transaction experiences, the higher their purchase

amounts and the more likely they are to be repeated purchasers and the

lower likelihood of them aborting an intended online transaction.

Based on the literature, the proposed research model is

illustrated in Figure 1.

Figure 1: Research Model

Source: Developed for the research

RESEARCH METHODOLOGY

One set of questions was designed and distributed to customers

who have online shopping experience as respondents. Respondents are

from student Universiti Teknikal Malaysia Melaka (UTeM) in Malacca to

get statistical information. The questionnaires distributed to 150

respondents to the targeted respondent to get data more accurately.

The questionnaires are based on this research topic.

In this study, two page questionnaire which consisted of 21 close

ended questions was employed. There are three main sections in the

questionnaire which is Section A, Section B and Section C. Section A

indicating demographic information: respondent’s gender, age,

education level, frequencies of purchasing over the Internet and

product purchased on online. Section B is about the level of

understanding of online shopping and Section B indicating factors

affecting customer satisfaction which is product quality, brands and

shopping experience. The questionnaire was designed based on a five-

point Likert-type scale. The scales represents, 1: “strongly

disagree”, 2: “disagree”, 3: “neutral”, 4: “agree”, 5: “strongly

agree”. The study concentrates on customer satisfaction that

immediately or indirectly involve in Malaysia online shopping.

DATA ANALYSIS

In this study, the researcher will be used descriptive analysis

and correlation analysis methods to analyze the data. All data will be

processed and analyzed using Statistical Package for Social Science

(SPSS) version 19; it can be used to analyze data collected from

surveys, tests, observation or even secondary data. This program helps

to facilitate data clearing, and checking for logical inconsistencies

in the dataset. The researcher will carry out data mining procedures

before the actual data analysis is performed. The responses from the

respondents will be coded accordingly before being transferred into a

data file.

RESULT AND ANALYSIS

Table 1 shows the summary of the demographic profile of

respondents. In this study demographic variables consisted of gender,

age, education level, often purchased and product purchased. In the

table, shows that there are 150 respondents participated in this

research. The results of the gender analysis show that the percentages

of respondents are 72% females and the rest of 28% are male. It

consists of 108 females and 42 males. For results by age, respondents

between age 22 and 25 years give the highest participation in this

research that is 96 respondents or 64%. Then, for the education level

of respondents in this research concludes that there is 96 % in 144 of

the respondents are Bachelor Degree level. Only one (0.70%) of

respondent have diploma and the other one has a PhD. For level of

education in Master, there are 2.7% in 4 of the respondents.

The summary results for frequencies of purchasing over the

Internet have 48% or 72 respondents, less than 5 times in a life. For

6 until 10 times buying, representing 26.7 % with 40 respondents

participated. Meanwhile, 11 to 15 times have the lowest number of

respondents that is 11.30% with 17 respondents. Based on this

research, the demographic data in product purchase online, it shows

that the highest percentage is 48.70% with 73 respondents come from

male and females that purchased fashion and apparel on online. The

lowest of frequency product purchased is 13 respondents or 8.70% are

categorized in buying others product such as food and beverages, sport

and equipment, books, service coupon, and electrical product.

Table 1: Summary of demographic profile

DemographicVariables

Categories Frequency Percentage(%)

Gender Male

Female

42

108

28

72

Age 18-21 years

22-25 years

41

96

27.3

64.0

26-29 years

30 and above

11

2

7.3

1.3

Education Level Diploma

Bachelor degree

Master

PhD

1

144

4

1

0.7

96.0

2.7

0.7

Often purchased Less than 5 times

6-10 times

11-15 times

16 times or more

72

40

17

21

48.0

26.7

11.3

14.0

Product purchased Fashion andapparel

Digital product

Ticket (traveland cinema)

Cosmetic product

Others

73

16

26

22

13

48.7

10.7

17.3

14.7

8.7


Reliability analysis

As referred in Table 2, it shows that the value of Cronbach’s

Alpha results for this research for all variables is 0.827. The value

is acceptable because it more than 0.5 which is at a very good result.

The Cronbach’s Alpha value that more than 0.7 is considering as

reliable result. Hence, the reliability analysis of the all variables

is acceptable.

Table 2: Reliability Statistics of Data Gathered

Cronbach'sAlpha

N of Items

.827 16


Pearson Correlation Coefficient Test

Pearson Correlation Coefficient is a method that

measures the validity of the data relationship. It is also indicates

the direction, the strength and significant of the relationship among

all variables. The value for a Pearson’s correlation can fall between

0.00 and 1.00.

Table 3: Correlations of Independent and Dependent Variable

CustomerSatisfact

ion

ProductQuality

Brand ShoppingExperienc

eCustomersatisfac

tion

PearsonCorrelati

onSig. (2-tailed)

N

1

150

.624**

.000150

.390**

.000150

.461**

.000150

ProductQuality

PearsonCorrelati

onSig. (2-tailed)

.624**

.000150

1

150

.394**

.000150

.341**

.000150

NBrand Pearson

Correlation

Sig. (2-tailed)

N

.390**

.000150

.394**

.000150

1

150

.480**

.000150

ShoppingExperien

ce

PearsonCorrelati

onSig. (2-tailed)

N

.461**

.000150

.341**

.000150

.480**

.000150

1

150

From the table 4.3 above, it shows that the result

analysis of the correlation between all the dependents variables and

independent variables. The dependent variable in this research is

customer satisfaction towards online shopping while there are three

independent variables which are product quality, brand and shopping

experience. Based on table, all the independent variables have a

significant relationship to dependent variable. This is based on the

Pearson Correlation value for each variable which are all positive

value. First, there is moderate relationship between product quality

and the customer satisfaction towards online shopping among university

students at Universiti Teknikal Malaysia Melaka. The value of the

coefficient correlation is 0.624, falls under the coefficient range of

“± 0.41 to ± 0.70”.

Next, there is weak relationship between brand and the


students at Universiti Teknikal Malaysia Melaka. The value of the

coefficient correlation is 0.390, falls under the coefficient range of

“± 0.21 to ± 0.40”. Last but not least, there is moderate relationship

between shopping experience and the customer satisfaction towards

online shopping among university students at Universiti Teknikal

Malaysia Melaka. The value of the coefficient correlation is 0.461,

falls under the coefficient range of “± 0.41 to ± 0.70”.

Regression Analysis

The regression analysis is used to test the hypothesis

relationship of factors affecting customer satisfaction towards online

shopping which is product quality, brands, and shopping experience.

Hypothesis of Product Quality and Customer Satisfaction

H0: There is no significant relationship between product quality and


students at Universiti Teknikal Malaysia Melaka

H1: There is a significant relationship between product quality andcustomer satisfaction towards online shopping among universitystudents at Universiti Teknikal Malaysia Melaka

Table 4: Regression for product quality

Model R R Square Adjusted RSquare

Std. Errorof the

Estimate

1 .624a .389 .385 .46114

a. Predictors: (Constant), Product Quality

Table 5: Coefficientsa for product quality

Model

1(Consta

nt)Product

Quality

Unstandardized

Coefficients

B 1.338 .660

Std.Error

.258 .068

Standardized

Coefficients

Beta

.624

t 5.178 9.708Sig. 0.000 0.000

a. Dependent Variable: Customer satisfaction

Table 4 shows that the results of the independent variable that

are needed into regression model and R (0.624) are the correlation of

the independent variable with the dependent variable. The results mean

that 39% of the variance (R square) has been significantly explained

by the independent variable. The adjusted R square also was taken into

account, 39% showed that there was a correlation. There has a

relationship between independent (product quality) and dependent

variable (customer satisfaction towards online shopping). Based on

coefficient Table 4, product quality is significant independent

variables that influences customer satisfaction toward online shopping

as the significant value are less than 0.05. Based on significant

level, p = 0.000 which is less than 0.05, then the H1 is accepted

hypothesis. It means that product quality has contributed to customer

satisfaction towards online shopping among university students.

Hypothesis of Brand and Customer Relationship

H0: There is no significant relationship between brand and customer


Universiti Teknikal Malaysia Melaka

H1: There is a significant relationship between brand and customer


Universiti Teknikal Malaysia Melaka

Table 6: Regression for brand


Std. Errorof the

Estimate

1 .390a .152 .146 .54337

a. Predictors: (Constant), Brand

Table 7: Coefficientsa for brand

Model 1

(Constant)

Brand

Unstandardized

Coefficients

B 2.562 .333

Std.Error

.249 .065

StandardizedCoefficients

Beta .390

t 10.307 5.146Sig. 0.000 0.000








relationship between independent (brand) and dependent variable

(customer satisfaction towards online shopping). Based on coefficient

Table 5, brand is significant independent variables that influences

customer satisfactions toward online shopping as the significant value

are less than 0.05. Based on significant level, p = 0.000 which is

less than 0.05, then the H1 is accepted hypothesis. It means that

brand has contributed to customer satisfaction towards online shopping

among university students.

Hypothesis of Shopping Experience and Customer Satisfaction

H0: There is no significant relationship between shopping experience



H0: There is significant relationship between shopping experience and



Table 8: Regression for Shopping Experience


Std. Errorof the

Estimate

1 .461a .213 .208 .52341

a. Predictors: (Constant), Shopping Experience

Table 9: Coefficientsa for Shopping Experience

Model 1

(Constant)

Shopping

Experience

Unstandardized

Coefficients

B 2.160 .660

Std.

Error

.266 .071

Standardized

Coefficients

Beta

.461

T 8.127 6.328Sig. 0.000 0.000








relationship between independent (shopping experience) and dependent

variable (customer satisfaction towards online shopping).

Based on coefficient Table 7, shopping experience is significant

independent variables that influences customer satisfaction toward

online shopping as the significant value are less than 0.05. Based on

significant level, p = 0.000 which is less than 0.05, then the H1 is

accepted hypothesis. It means that shopping experience has contributed

to customer satisfaction towards online shopping among university

students.

DISCUSSION

Research Objective 1

The first objective of this research is to examine the

relationship between product quality and customer satisfaction among

university students at Universiti Teknikal Malaysia Melaka.

Based on data analysis in section 4, the researchers had

determined the independent variables that influences on customer

satisfaction, which are product quality, brand and shopping

experience. The researchers had analysed three factors by using

correlation analysis. The correlation analysis is used to find whether

all of these three factors have relationship with customer

satisfaction (dependent variable), thus influences this dependent

variable.

Based on the findings, it shows that the relationship between

product quality and customer satisfaction is significant. Thus, the

result interpreted that consumers have received what they were

expected on about the product they purchase. Therefore, it is directly

meant that they were satisfied with the product or service offered.

So, when the perceived product quality seems meet or exceed consumer

expectation, the probability for them to repeat online purchasing will

increase due confident level on the product quality offered, which

already experienced by the consumer.


The second objective is to determine the relationship between

brand and customer satisfaction among university students at

Universiti Teknikal Malaysia Melaka.

Besides product quality, brand also shown as significant

relationship with customer satisfaction towards online shopping. Based

on coefficient table in Table 5, brand is resulted as significant

independent variable that influences customer satisfactions toward

online shopping, which the significant value are 0.000 which is less

than 0.05. Thus, the result gained gives a meaning that, customers

were satisfied with the brand of product, which is originally not a

fake brand product. It is about overall consumer’s evaluation based on

the total purchase and experience with a brand of product or service

they purchase. However, brand trust, in this vein, expresses the

belief of consumers that the experienced brand satisfaction will

continue to be fulfilled by the brand (Zhou, Zhang, Su & Zhou, 2012).

Therefore, the higher the degree of brand satisfaction the customer

realizes, the higher the level of brand trust.


The third objective is to analyse the relationship between

shopping experience and customer satisfaction among university

students at Universiti Teknikal Malaysia Melaka.

Based on the result findings in section 4, shopping experience is

shown as significant relationship between shopping experience and

customer satisfaction. As been mentioned in literature review part,

shopping experience is the feelings of customer experiences during the

use of product and the process of purchasing the product which is the

delivery of product on time or not, the features of the product, the

features of website of the product and the service offer. Thus, this

positive result is interpreted as customer were satisfied with the

process of online purchasing products and services.

Therefore, brand is contributed as one of the vital variable

affected on customer satisfaction. The more experiences the consumers

towards the online shopping, the more satisfy they are with past

online transaction experiences. Besides, the higher the purchase

amounts, the more likely they are to repeat purchase then and the

lower likelihood of them aborting an intended online transaction.

RESEARCH RECOMMENDATION

In this research, the researcher is only test three independent

variables which are product quality, brand, and shopping experience on


students. This study provides many opportunities for future research,

for example a wide range of possible salient beliefs about shopping

online. So, the researcher hopes that for the future research may

include other factors of customer satisfaction towards online shopping

like advertisement that affected customer satisfaction. Furthermore,

future research should address other relevant construct that affects

customer satisfaction on online shopping. The measures created for

this study should support future research. It is clear that more and

different variables are needed to understand shopping on Internet

fully. It is relatively new phenomenon, and as such may require

additional rethinking of used models.

Lastly, if the researcher is interested in doing survey method in

the future, the questions in questionnaires should be simple and can

be understand by the respondent, so that the respondent will answer

based on their understandings. The targeted respondents should be to

the career person so that the result will be more acceptable.

CONCLUSION

Based on the findings, all components in factors that impact the

customer satisfaction towards online shopping have significant effect.

In this research the researcher just only focus on three factors that

give impact on customer satisfaction which are product quality, brand

and shopping experience. Various approaches have been used in finding

answers of objectives that stated in this research which are

distributed questionnaires, as well as some of methods used to analyze

the data obtained such as, validity and reliability analysis,

correlation coefficient and regression analysis. All data were

obtained from a variety of background of respondent which are the

Master student, PhD student, and Degree student that are from

different year in Faculty Technology Management and Technopreneurship

(FPTT). Finally, the finding sees that there is a significant

relationship between the customer satisfactions towards online

shopping (dependent variable) and the product quality, brand and

shopping experience (independent variables).

ACKNOWLEDGEMENT

This work is supported by Faculty of Technology Management and

Technopreneurship, Universiti Teknikal Malaysia Melaka.

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