Furthermore, Teas (1993) also argued that perceived service quality was the accumulation of customer satisfaction. Cronin and Taylor (1992) examined four service industries of fast food, banking, dry-cleaning, pest control to interpret the relationship between service quality and customer satisfaction and they found that service quality was an antecedent of customer satisfaction. Oliver (1993) addressed some distinctions among the meanings of quality and satisfaction. He suggested that satisfaction judgments may result from any dimension, quality related or not. Brady and Cronin (2001) summarized the various studies into one model called hierarchical service quality model (HSQM) which consists of three primary dimensions: interaction quality, physical environment quality and outcome quality. Each of these dimensions will split into various sub-dimensions later. As the discussion above, we can summarized that overall customer satisfaction is based on the information from all previous experiences with the service provider and is viewed as a function of all previous transaction-specific satisfactions (Teas, 1993)
2.5 Price and Customer Satisfaction
In several customer satisfaction theories, price satisfaction was considered as an important price policy to satisfy customers. Fornell et al. 1996 examined the impact of price on overall satisfaction in various industries and the result shown that in each sector examined, price plays an important role. In fact, price satisfaction can be conceptualized as a multidimensional construct (Matzler et al. 2006) and that several dimensions influence overall customer satisfaction. Diller (2000) found that price satisfaction dimension consists of price-quality ratio, price fairness, price transparency, price confident, price reliability and relative price constitute. Matzler et al. (2006) found that when customers are satisfied or dissatisfied with the overall price, they may consider more specific price dimension. Thus, customers can be satisfied with one dimension and less satisfied with another one. Urban (2003) suggested that price transparency can increases access to information, more alternatives, more simplified transaction, communication with customers. When price transparency appears, customers can have a clear, comprehensive, current and effortless overview about company’s quoted price (Diller, 1997). As a consequence, higher price transparency can lead to higher customer satisfaction. Furthermore, Lam et al. (2004) suggested that a favourable price-quality ratio (e.g. high customer value) will enhance customer satisfaction. Price confidence addresses the question to what extent the consumer believes that an offered price is currently favorable (Diller, 1997, 2000). As the result that the more confident that customers have with an offer will lead to the higher customer satisfaction with price. Furthermore, price confident is related to price-transparency, price quality ratio and relative price, thus, customers can be more satisfied if they are able to evaluate a price offer and also if an offer is favorable. Relative price refers to the price comparison of customer about the product and service with other competitors. As Compeau and Grewal (1994) noted that relative price of an offer directly affects satisfaction with the price and, as a result, satisfaction with the offer.
Anderson, Fornell and Lehmann (1994) argued price is very important factor of customer satisfaction because whenever customers consider of buying a product or using service they always think about the price. Zeithaml and Bitner (1996) insisted that there is a relationship between price and satisfaction; they asserted that the extent of satisfaction was based on product quality, service quality, price, situation and personal factor. However, price was not fully interpreted in early studies (Spreng, Dixon, and Alshavsky 1993). According to Xia et al. (2004) price fairness refer to” a perceived fairness judgment by a buyer of a seller’s price”. Zeithaml (1988) suggested that customer may evaluate the quality of product or service through price and perceived price. Oliver and Swan (1989) argued that customers often compare their gain to the gains of the sellers and if they think that the sellers earn exceptionally high profits for the products or services, they will perceive that as unfair and the consequence is less satisfaction. Urbany et al. (1989), for example found that customers perceive a price increase as unfair if they think it only served to increase profits. In contrast, price fairness would enhance customer satisfaction.
As in consumer’s cognitive conception, Zeithaml also noted that when customer consider of buying a product or service there must be price sacrificed or given up. Therefore, price is also known as sacrificed in another previous studied ( Chang and Wildt 1994; Athanassopoulos 2000). Zeithaml (1988) recognized that the lower perceived price will lead to lower the sacrifice so customer may get more attractive to purchase the product or service. However, it is not guaranteed that lower perceived price can make to more satisfaction; it must depend on other factor such as product or service quality. In the concept of equity, which underlines fairness, Darke and Dahl (2003) found that generally customers should pay the same price for the same product or service. An example of the relationship between price and customer satisfaction in automobile is when customers consider to buy a car, they are typically received an initial price before they discuss about the final price and financial terms with the sellers. Therefore, price is very important with customer satisfaction.
2.6 Chapter Conclusion
This chapter has investigated several studies about product quality, service quality and price. Through those studies, the impacts of product quality, service quality and price on customer satisfaction have been clarified. Overall customer satisfaction is strongly depended on these factors.
CHAPTER 3 RESEARCH METHODOLOGY
3.1 Introduction
The aim of this chapter is to outline and demonstrate the research methodology which is used for this paper. The research methods that will be use in this paper will help to achieve the aims and objectives of this project referring to the data collection and data analysis that has been carried out .Particularly in this paper, the purpose is to investigate the impact of product quality, service quality and price on customer satisfaction. This chapter includes research design, strategy and methods. Furthermore, this paper also discusses the reasons why the methods were chosen and the ethical issues and limitation will be considered and discussed as well.
3.2 Research theory and approach
3.2.1 Research theory
The research philosophy and approach is one of the most important aspects of any research. Methodology refers to the theory of such the ways research should be undertaken, including both of the theoretical and philosophical notions that the research is based on and the connotations of these for the methods chosen ( Saunders et al. 2009). For the research to be at it is most effective and accurate to help solve the questions to the project, the method must be chosen correctly and adequately to ensure the best possible result. The research philosophy consists of two view points. Positivism can be seen as working with an observable social reality and the result of research can be law-like generalizations. On the other hand Interpretivism is often considers to understanding the differences between human as social actor, however Interpretivism refers to the complex of business situations and to be theorized by definite “laws”. Taking into consideration the means of the project I have chosen to use an Interpretivisim approach to the research (Saunders et al. 2007).
3.2.2 Research philosophy approach
According to Collis and Hussey (2003 p.11), research philosophy is “whether you are moving from the general to the specific or vice versa”. The form of deduction in general refers to whether a theory or hypothesis is developed and then tested by empirical evidence or whether data are gathered first and a theory is developed as a result of the data analysis ( Bryman and Bell 2007). The deductive approach based on scientific principles and the collection of quantitative data whereas, the inductive approach emphasizes on gaining an understanding of the meanings that human attach to events and the use of qualitative data (Saunder et al. 2009). An inductive approach will be used for this paper, as this is the most suitable approach to answering the objectives of the research project. An inductive approach is appropriate with the aims of this project in regard to hypothesis or theory not being tested; this is not gaining new knowledge on the phenomena under study, by identifying pattern through the data analysis (Mayor and Blackmon 2005). Furthermore, an inductive approach also provides the flexibility that enables the researchers study the phenomena in a variety aspects and perhaps providing a number of explanations of what is happening (Lancaster 2005).
3.3 Research strategy and design:
Taking the purpose of the research project the case study was chosen to investigate on the impact of product quality, service quality and price on customer satisfaction. As Saunder et al. 2009 suggested that the research strategy is a general framework of how the researchers will answer the questions given. Taking in to consideration the exploratory purpose of the research project, a case study strategy would facilitate the process. This kind of strategy is often associated with exploratory research as it is enable to answer why questions as well as how and what ( Saunders et al. 2009)(e.g how service quality influences customer satisfaction). Overall this case study will help provide evidence to the answers of the question, as it focus on revealing and clarifying the unique features of the case and not test the hypothesis ( Adam et al. 2007).
Additionally, there is no hypothesis are tested within this study, as the paper is emphasizing on the customer satisfaction in automobile industry, where the aim is to identify the patterns of the impact of product quality, service quality and price on customer satisfaction. Therefore, these patterns will generate theory from the analysis of results. This will be achieved by exploring, analyzing and understanding the impact of several factors on customer satisfaction in automobile industry, in order to address the aim of this project. Case study is often used together with qualitative methods such as participant observation and in-depth interviews ( Bryman and Bell 2007). This is in fact that they assist the process of producing detailed and also rich data that are required for the rigorous investigation of a case.
3.5 Research methods
3.5.1 Qualitative and Quantitative method
There are two forms of research methods: qualitative and quantitative research (Saunders et al. 2003).
A quantitative approach “is objective in nature and concentrates on measuring phenomena” (Collis and Hussey 2003 p.13). In addition, it encompasses gathering and analysing numerical data and the use of statistical tests, where the meaning is drawn from numbers. This approach emphasizes on testing a theory, by incorporating the traditions and norms of a natural scientific concept and more specifically of positivism (Bryman and Bell 2007). Additionally, a quantitative approach typifies the position of a social reality as external and objective (Bryman and Bell 2007).
On the other hand, qualitative approach “is more subjective in nature and involves examining and reflecting on perceptions” (Collis and Hussey 2003 p.13). In other words, it intends to obtain an understanding of social and human actions, concentrating on meanings that are articulated through words. Furthermore, a qualitative approach focuses on generating theory and on the ways that people interpret their social world, and represents the position that social reality is a continually changing and evolving property of individuals’ creation (Bryman and Bell 2007).
The research was based on primary data and a qualitative method was chosen. Qualitative method often refers to the producing richness and depth of detailed information with small number and case ( Patton 2002) while quantitative method deals with numerical data and statistic ( Saunder et al. 2007).However, a qualitative approach will be followed as the purpose of this paper is looking to explore and gain new insights on the phenomena under investigation. In addition, it is focus on the generation of theory rather than testing hypothesis by exploring the phenomena through interpreting the behavior of social factor. This can acquired by examine the influences of service quality, product quality and price on customer satisfaction and exploring the questions of what, why and how these factors have an impact on. Due to the nature of this project, the rich data of qualitative approach would facilitate the process of gaining new insight and understanding the impact of several factors on customer satisfaction from the manager’s and customer’s perspective.
3.5.2 Semi structure interview
Having chosen an interpretive inductive approach, attention is paid to the quality, depth and richness of the data; hence, qualitative data should be collected (Collis and Hussey 2003). Semi-structured interviews were used as the most suitable tool for gathering the primary data. Semi-structure interviews considers as valuable tool when finding rich and detailed data, according to the flexibility that they offer. By using semi-structure interview, the interviewee has the opportunity to discuss more openly and also the interviewer can discover new issues and thus, adjust the research questions accordingly to explore the set issues (Bryman and Bell 2007). Additionally, semi-structure interview would allowed more flexibility, the interviewer has the possibility to change the order of the questions within the interview time, and can ask more complex questions that perhaps not in the current structure of the interview( Bryman and Bell 2007). Furthermore, the researcher has the opportunity to “probe” answers, where interviewees are required to clarify or build on their responses (Saunders et al. 2009)
In this research, two different semi-structure interview questions were constructed in order to fulfill the objectives of the research. One set of questions was directly to the marketing managers of car companies and the other to the customers. Both set of questions were semi-structure interview with several question involve with the topic needed to be discussed and there was no specific order of interview questions in purpose to avoid restriction the interviewee’s thought process as well as provide the opportunity to the researcher to explore each topic as it arose in discussion. This strategy could enhance the researcher discover a new topic that had not thought before and therefore enhancing the data.
The interviews were carried out in Vietnam over one month from December to January. There are nine marketing managers from three car brands and forty customers of these brands that have been interviewed. The interview questions were asked in Vietnamese which gave the participants more ease with the language and as the result they were more open to discuss further on the topics when necessary. Hence, more precise and detailed answers were obtained. The interviews were generally carried out face to face so that the situation can be presonalised and physical impressions. The interviews for both managers and customers were happened in about half an hour and not only took place at their offices after an appointment was made but also in coffee shops or in restaurants in order to make the participants more comfortable.
3.6 Alternative methods
There was some research methods considered. Telephone or emails interview were consider, nevertheless, it would be insufficient as the interview have less interpersonal and physical impressions as well as no visual contact is made (Gillham 2005). Focus group is unsuitable because people may be uncomfortable to answer the question or express their opinion in front of the other (Cresswell 2003). Structured and unstructured interview were not adopted because it will be hard for gaining in-depth answer, moreover difficult when analysis data. Semi-structure interview was the most effective way for the aims and objectives of this research.
3.7 Data analysis
In order to ensure that all data from the interviews were accurately collected, a voice recorder was used with consent and transcribed with notes for backup. This is very important when using qualitative data, to enable the process for the detailed analysis that is needed in this type of research (Bryman and Bell 2007). Moreover, the researcher will have a record of all answers and can refer to it when necessary.
This research followed the method of Saunder et al. (2007) and that is an approach for analysis qualitative data research
3.8 Limitation
3.8.1Time
The research has the limited time as to complete in sixth months. In general, many researches are provided in a long time, because of the time limited and moreover solving its problem, so this study has chosen the qualitative methods of data collection through interview and concentrate on a single case study. Therefore, the research can be done in short time periods.
3.8.2 Sample technical and size
Due to the limited time and access constraints this research focus only single case study which perhaps may not apply in other organizations or in different countries with the different responses. The primary data was collect from two different samples – the marketing managers and the customers. This study has used non-probability sampling which can prevent the researcher to conclude to some general results about the population, it can still generate information-rich data (Maylor and Blackmon 2005; Saunders et al. 2009).
This type of sampling technical often used with case study research and particularly beneficial as cases are purposefully selected to offer as much information as possible (Saunders et al. 2009). The logic behind judgmental sampling is that it offers the freedom to choose a sample that is knowledgeable on the topic and will best answer the project objectives. This study attempts to clarify the specific impact of service quality, product quality and price on customer satisfaction in a single case of Vietnamese automobile industry rather than in a widespread range. Moreover, by focusing on the marketing managers of three car brand and their customers who have the key position, the aims and the objectives of this research can be accomplished.
3.8.3 Reliability and Validity
Reliability offers information on the consistency and accuracy of the data collection process, in order for the research to be replicated and conclude in the same findings (Seliger and Shohamy 2001). However, Saunders et al. (2009) argue that in an interpretive research is not the intention for the research to be repeated, since the findings captured the reality at the time the data were gathered, under circumstances that may be subject to change. To protect the information of the answers for other purpose such as reflecting positive image, the researcher kept all information confidential and anonymous so participants can easy to express the truth. Furthermore, the answers of managers maybe almost similar because the interviews are often take place at work so it may affect other interviewees. This can be refers to reliability issues (Saunder et al. 2000). To solve this issue, the interviews were also happened in different places or in different working time. Additionally, there was an issue of bias responses because of the non-verbal behavior within the interview or the ways that the researcher asked questions. To overcome this issue, the questions were asked and discussed with some friends in various ways to make sure the questions can be understood properly. Furthermore, body language and eye contact were also considered during interviews time which can improve interviews results.
3.9 Ethical issues
Within the context of research, ethics involve to the appropriateness of researcher behavior in relation to the rights of the participants who become the subject of researcher work, or are affected by it ( Saunders et al. 2009:183). Research ethics considers the moral and responsible way of the researcher in term of gaining access, collecting data, processing and storing participants ‘data. The participants were aware of the purpose and also the content of this research before they were interviewing. This can allowed the participants have more understanding about the interview questions and they would be more confident to answer. All participants were voluntary and they can withdraw at any time they want within interview time. Moreover, the interview questions were asked in a respectful manner that would make the participants feel comfortable. Additionally, Participants were ensured that their individual name and the name of the organization will be kept in secret and secure and the interview will remain anonymous to inform privacy. The interview record needed the permission from the participants and the record would not be used for other purpose as well as the interview. Furthermore, the outcomes and the results of the research will be available for the participants.
3.10 Chapter conclusion
This chapter has highlighted the methodology of this research which is implemented addressing the aims and the objectives of this study. The adoption of qualitative approach and semi-structure interview were suitable with the purpose of this paper. Moreover, an approach for data analysis process was also concerned. Additionally, the limitation and ethical issue were highlighted in the last part of this chapter.
CHAPTER 4 DATA ANALYSIS AND DISCUSSION
4.1 Introduction
This chapter will discuss and analyze the data gathered and also relate it with the theories in the literature review. The information gaining from these processes would help to fulfill the research questions as well as research aims and objectives; particularly, to investigate the impact of product quality, service quality and price on customer satisfaction.
4.2 Customer satisfaction in Managers/Customers’ perspective and its role
In this section of the research, it was very important to consider the meaning and the importance of customer satisfaction. Before we can identify and clarify that these factors have an impact on customer’s satisfactions. Managers that have been working in marketing for more than three years would have more depth in understanding the customers service and whether the customers would be satisfy with the service provided; as well as other manager who has not experienced in the sector. Below are some of the manager’s views on customer’s satisfactions:
The question was asked the mangers in order to gain better understanding about the meaning of customer satisfaction:
Manager 2 :
“I think it is very simple with my experience that customer satisfaction occurs when you make your customer happy.”
Manger 3:
“Customer satisfaction is how you satisfy your customer with your products or services.”
Manager 4:
“I think customer satisfaction refers to how your products, prices and your services meet or exceed customer expectation.”
Majority of the managers have similar views on how to satisfy the customers, as they mainly focus on the product and service delivered. They also bear in mind the ways of how their products and services can improve to meet customer’s expectation in order to satisfy their customers.
Furthermore, another question was as customers as how can they understand the meaning of customer satisfaction.
Customer 3:
“ I do not understand what is the meaning of customer satisfaction”
Customer 11:
“I think customer satisfaction is about the happiness of customer about the product, service and price.”
Customer 21:
“Customer satisfaction refers to the term that your product, service and price which you purchased can meet your expectation”
The views of managers and customers in term of customer satisfaction were supported for the literature review. According to Yi (1990), customer satisfaction refers to the term of products or services meet or do not meet customer expectation. Furthermore, the interview also highlighted the emotion of customers of their purchases that was similar with the view of Oliver (1981) who suggested the emotion of customer that comes from product or service experiences and his or her expectation of performance about that product and service. With the view of customers, the meaning of customer satisfaction seems to be less complicated compare with the suggestion in literature. They become more emotional when consider customer satisfaction in their views, whereas managers generally provided an in depth understanding with their knowledge.
In addition, the following question was asked the managers to identify the important role of customer satisfaction with their companies business and especially in the aspect of marketing:
Manager 2:
“Customer satisfaction is very important with the success of company as well as an important factor that every marketing manager should be concerned in any marketing decision.”
Manager 4:
“Customer satisfaction is apparently affected the success of the business and it is especially important because customers are the key that bring the profit for the company. Customers would buy more products and perhaps introducing other people to buy it if they are satisfied. That means your company can enhance customer loyalty and attract more new customers. Therefore, your company can be strong development and company’s revenue will increase.”
Manager 7:
“Customer satisfaction is very important and it determines the development of our brand image as well as our reputation in the competitive automobile market. The company just can be success when they could satisfy them.”
Referring to above comments most managers focused on the important of customer satisfaction with the business. They highlighted an important of customer satisfaction through the favorable of customer about a product and service, which can enhance the opportunity to make the business successful.
As literature mentioned the important of customer satisfaction, the research finding also support the theories in literature. Kim, Lee and Yoo (2006) argued that customer satisfaction could lead to customer loyalty and enhance word-of-mouth. That was exactly the same point compared with research findings through the views of some participants. Moreover, the research found that the role of customer satisfaction is also considered as necessary in marketing decision and it was supported for the theory of Erevelles and Leavit (1992). However, there were the supplements of the finding to the theory such as the managers often consider the profit and the revenue of their company while very less theory considers that point of view.
4.3 Product Quality
There were different views from the managers but most of them agreed product quality is the most important factor that affects customer satisfaction. Almost all of managers often considered product quality as a very first factor in business operation in order to satisfy customers. A majority of managers focus on the development of product up to date in order to increase quality for their products, which could bring more new products with high quality standard to customers in the market.
The question was asked the managers with the purpose to investigate the impact of product quality on customer satisfaction:
Manager 4:
“I think product quality is one of the most important conditions in order to satisfy customers. The customers will be more welcome if a product has a fancy appearance, showing a sense of high quality and enduring as well. For instance, our customers often consider the safety factors (seatbelts, air bags, chassis and material toughness, ect), the design (exterior, interior designs and materials, comfort and versatility, ect) and fuel consumption of the car when they buy our products. If the products can meet customers’ demand, they will be satisfied.”
Manager 8:
“Product Quality has a considerable impact on consumer satisfaction because it connects directly with consumers and is the foundation for consumers’ evaluation of the product as well as the company’s brand image. When customers consider buying a car, they firstly think about the quality of that car as a priority. Regarding to Product quality, in my opinion, the most important factor of the car must be Safety rating.”
The following question was asked mangers in order to clarify the impact of product quality on customer satisfaction in business operation:
Manager 4:
“Some examples of our company Product Quality Strategy to satisfy customer: Our Company often consider the product development process as very important for the success of our business. We always provide various products with different models and styles which can make choices easier for customers. Product innovation is often considered as an important factor of company products’ strategy in order to supply the market with the newest product features and the lower cost as well. The products which are approaching the market must be widely advertised by using all up-to-date sources of communication and must have the appropriately higher quality and suitable price compared with the similar models of the competitors. I think the product development process is necessary and it would bring customer satisfaction.”
Manager 8:
“My brand often attempt to find out the requirement for Product Quality of customer. Therefore, my company always try to improves the quality of product such as innovate new materials, using car safety accessories such as tires do not flat after being puncture or ABS function, to lower the risk of auto accidents. Furthermore, the customers in Vietnam often consider the fuel consumption as the important factor when they purchase a new car so that our company has attempted to design the products with less fuel consumption as possible (The Mercedes E250- fuel consumption up to 53.4 mpg). Those were some of examples that my company has been considered to satisfy customers.”
In managers’ view, product quality truly influences customer satisfaction. They considered the important of product quality as an indispensable in order to satisfy customers. Most of managers focused on the features of product such as the safety, the design and the fuel consumption; that would meet the customers ‘demand. Those factors would be a guarantee for the satisfaction of customers. Managers emphasized on product development with the innovation and increasing product quality which can fulfill customers ‘desire. These views of managers were supported Akao (1990) argument of Quality Function Deployment. Akao focused on the development of a product such as the design, the function, and the quality process of product. As the research findings showed, the companies attempted to find out customers’ requirements of products and they started design products with high quality which are appropriate with customer needs and wants. It is similar of what Akao mentioned in literature about the transform customers’ requirements into design. The findings also support the theory of Maddux et al. (1991) which refers to the theory of customer wants and provides the products that can satisfy customers. According to Brown (1991) and his suggestion, most of managers agreed that the product development process is very important and it would brings the product design beneficial, product quality and lower cost which can enhance customer satisfaction. Gravin (1987) provided a strategic approach containing the dimensions of product quality such as performance, features, reliability, conformity, durability, serviceability, aesthetics and perceived quality. The research findings were strongly supported his argument. For example, the managers contained product quality with its performance (safety, braking, steering), feature ( CD-VCD deck),reliability ( can travel when the street flooded), conformity (leather seat, loudspeaker), durability ( Long-lasting), serviceability ( engine speed) and aesthetic ( colour, shaped).
Additionally, other question was asked customers and that help gain better understanding of what exactly product quality influences customer satisfaction:
Customer 13:
“Yes, I think Product Quality has the huge impact on customer satisfaction. Because I drive a cheaper car which has only one airbag in driving seat, no supporting for wheel pressure, no Anti-lock braking system; that can make me feels unsafe. My income is still low so I cannot afford an expensive car; I just can buy a car that appropriate with my money now. I would purchase the high quality car if I have enough money. It will bring more satisfaction to me.”
Customer 17:
“I think Product Quality is directly affected customer satisfaction because if the car with poor quality can leads to unsafety, uncomfortability, less stability, environmental unfriendliness. “
The following question was asked customers and the purpose of this question was given some examples from customers to prove that what specific of product quality has an impact on customer satisfaction.
Customer 13:
“My car is small which very suitable for the narrow of Hanoi streets with high congestion; my car engine is also week so it uses less fuel consumption. I think the price of the car is appropriate with its quality. It still can satisfy me with my purpose as travel from home to work and safe my money as well for the lower fuel consumption.”
Customer 17:
“I think my experience with the car im driving now (Mercedes E250 ) can appropriately justify my Product Quality statement above : My car has four airbags, Anti-lock braking system (ABS), Electronic Stability Program, Tyre pressure loss warning system, Cruise control with Speedtronic variable speed limiter, Automatic child seat recognition sensor, Pre-Safe® anticipatory safety system, Adaptive Brake System…etc. Those functions make me feel safer. And moreover, I love my car with very nice shaped and color and the design option inside makes me feel comfortable such as leather seat, outside temperature display, rear seat belt status indicator…etc. “
All customers agreed that product quality affects customer satisfaction. Most of them considered product quality as a priority and the very first factor which would strongly influences the satisfaction of customers. The research findings in customers showed that high quality of product can lead to the high of customer satisfaction. Majority of customers assess product quality through its performance, design, characteristic and function and they will be satisfied if the quality of product exceed their expectation. That was included in the view of Dawar (1999) and Kano (1984) with the suggestion of product features. The research found that customers normally see the product quality process different with the managers of the brands and that is similar with Garvin (1987) view. It is truly related to the literature as poor quality would lead to unsatisfied. However, the research found that in some cases, low product quality still can satisfy customers if the products are suitable with the customer income. If low quality of products can meet the purpose of customer, they are still satisfied. That is unexpected finding which was totally ignored in literature. Moreover, several customers expressed their views that they would more satisfied if the product quality is provided with cheap and suitable price. Most of literature research theories did not mention the suitable price with product quality in term of customer satisfaction. This is also unexpected finding and the researchers should consider that when discussing an impact of product quality on customer satisfaction.
4.4 Service quality
All of managers had the same views about the important of service quality with customer satisfaction which were similar with the definition of Juran (1989) for service quality. All mangers mentioned their explanation of how service quality influences customer satisfaction.
The question was asked the managers and the purpose of this question is to prove that service quality strongly affects customer satisfaction.
Manager 4
“Service quality largely influences customer satisfaction. In my experience, customers often perceive service quality as an important factor when they consider of buying the products. The high quality of service can lead to the high of customer satisfaction. In fact, customers often compare service quality between our company and similar competitors in the market. If the quality of service is not as expected of it real performance, customers may dislike the service its means they tend to unaccept the product and customers can be unsatisfied. The company can provide excellent performance quality of service will make customer more impressive and more belief with the company product and service, it would attracts more new customers and retain customer loyalty.”
Manager 5
“I think service quality is very important with customer satisfaction. If the service is good, customers will be more satisfied; the high quality of service would enhance customer loyalty. The customers often evaluate the quality of product through service provided. The high quality of service which can meet customer expectation would lead to the customers are more welcome and trusted with the products. As the result, they will keep buying your product and continue using the company service. “
Furthermore, another question was asked the managers and the purpose of this question is to investigate what exactly service quality influences customer satisfaction in business operation.
Manager 4
“My company often offers some service promotions for customers such as increasing quality guarantee time, offer free driving test, free collect customers ‘car to check it every three months…etc. We often train our worker in repairing place which can improve their skill that helps to maintain customer car more efficient. Moreover, we also provide the customer excellent service in our showroom with model showroom designing style, the sellers were welcome customers with respect and nice attitude .The sellers are also kept updating about the new product information in order to introduce customers the products details, that would helps customer easy to choose the car which is appropriate for them. With the service quality provided by my company, customer will be happy and satisfied.”
Manager 5
“My company showroom is always clean, courteous, and solemn. The sellers always treat customers with respect, enthusiasm, seriously paying attention and introduce the products in various ways which make customer more convenient when choosing a product. As the consequence, they would be satisfied when they come to our showroom and they can buy an appropriate car with their needs and wants. The product will be usually taking care off after customer purchase through the process fleet after sales programme. For example, free delivery, free of checking a car every month, collect service feedback…etc. Those were some of my company service strategies in order to satisfy our customers.”
All of managers agreed that high quality of service often leads to the high customer satisfaction and it was similar with Bitner (1990) argument. Most of them suggested that service quality should be view in customers’ perspective which customers often look at the business service quality before they purchase the products or use the services. Those were supported for Carman (1990) and his suggestion in literature. The managers focused on the important of service quality on customer satisfaction which would enhance customer loyalty. Moreover, the managers also emphasized on “what” and “how” service is provided which refer to Gronross (1982) theory with the dimension of service which are technical aspect and functional aspect. For example, most of the brands always focus on their showroom decoration and the attitude of the sellers with their customers. Secondly, they often train the sellers and the workers in repair centres in order to improve their skill that is necessary requirement of their jobs. As the result, customers would be satisfied with high quality of service that the brands provided. In addition, the companies also provided quality of service after sales for customers such as checking, maintaining, and repairing customer cars when the cars have any problem up to a year after sales. It is supported for Lehtinen and Lehtinen (1982) with the concept of service quality which consists of physical of product and physical support. Furthermore, the research findings also supported for Parasuraman, Zeithaml, and Berry (1988) theory, service quality consists of 5 dimensions such as tangible, reliability, responsiveness, assurance and empathy. For instance, the brands were responsible and insure the quality of the car after sales. The following findings showed that some managers considered service promotion into service quality in order to satisfy customers and it was provided upon their experience. The findings were unexpected as the literature was less concerned that service promotion in service quality would affects customer satisfaction.
The question was asked customers with the purpose to prove that service quality has an impact on customer satisfaction.
Customer 14:
“I think service quality have a huge impact on customer satisfaction. When you come to the showroom if the sellers receive you with respect, nice attitude and introduce you all detail of the car model that they have; you can be happy and it can affect your decision of buying a product. Moreover, the service after you purchase is very important. For instance, if you car have problem it must be quickly repaired as soon as possible because it is your means of communication and affect directly to your life. It will be difficult to travel from home to work without your car in a long time.”
Customer 25:
“I think service quality always affects customer satisfaction. If the service is poor, you can feel uncomfortable when using it. Moreover, almost all customers want to get high quality of service with a minimum price that would be more satisfied for customers. The attitude and the instruction for a product of the sellers is very important, it can make positive feeling of customers about the service provided. In my opinion, I think almost Vietnamese customers have a car, they are looking for the lower price for service after sale of the car because their general income still low. With many customers, if high quality of service is related with the high price that would make them less satisfied. “
The following question was asked customers to provide some real examples according to their experience that service quality really influences customer satisfaction.
Customer 14:
“I have some experiences that affect my satisfaction. I feel happy when I came to the showroom to buy my car. The showroom was very nice. The seller received me with very nice attitude and he explained everything about all the models that they have. That can make me have the right decision of choosing the car to buy. I was happy to buy it. After purchase the car, the seller called me to ask about the operation of the car and asked me that the car have any problem or not. After three month, they came to my house and picked my car up to the repair centre for maintaining it. I am satisfied with the service they provided. I think service quality is very important to satisfy me. “
Customer 25:
“In my experience, when I bought my car just a few months, I had problem with it and my car stopped on the street. I called the customer service and after only 15 minutes they sent the person came to check my car. He fixed my car in only 10 minutes and I was impressing with his skill. I was happy with the service quality of my car brand, that was satisfied me. “
As managers, all customers also though that service quality always affects customer satisfaction. This is mentioned from their own satisfaction experience of the service before and after sales .The service in the showroom which is firstly related to customer feelings of the car brand and it can be the foundation for customers’ evaluation for service quality. That could be referred to Rust and Oliver (1994) argument which suggests that customers believe in the probability of service leading to a positive feeling. At the beginning, before customers purchase a product, they always require a product guarantee as well as an assurance for service after sale. If the service quality of the brand could provide customers a surely guarantee, as the result, customer satisfaction will improves. That may supported for Kotler( 1994) theory with his view. The following findings are in accordance with Parasuraman, Zeithaml, and Berry (1988) view of SERVQUAL and customer expectation. For instance, a customer had problem with his car and the service centre sent a worker came to fix his car in very short time and then performed impressive skill. A customer was surprised with the quality of service that exceeded his expectation. Consequently, a customer was very happy and more satisfied with the service quality provided by his car brand. In general, the research findings and literature have the same view point about the high service quality would lead to higher customer satisfaction. Nevertheless, in some case it is not accurate as the results were found that high service quality with high price perhaps lead to the less satisfaction of customers because they may be unhappy about the expensive price. In addition, the research found that poor service quality still can satisfy customer if it has low price and as long as it satisfies customer specific purpose ( i.e for travel from home to work). Those were unexpected findings and its not directly specified in service quality lecture.
4.5 Price
The question was asked the managers to investigate that price does really have an impact on customer satisfaction.
Manager 1:
“I think price has a huge impact on customer satisfaction. The suitable price would lead to higher customer satisfaction. Customers often prefer suitable price with the quality of products and services. Therefore, they likely want to see clear price for all of the products from the producers so they can have a right decision to choose an appropriate product. With Vietnamese customers, cheap price of products and services would often lead to an increasing customer satisfaction. In fact, because of the very high tax rate for the cars import which approximate 82% value of the cars so that customers always consider price as a priority factor when they make a decision of purchasing.(rewrite this sentence) Moreover, because Vietnam cannot produce the car parts for replace so if the price of import spare parts of the cars is low would lead to more satisfaction of customers.”
Manager 6:
“I think price is special factor which has an important impact on customer satisfaction. At the time with the increasing of inflation in Vietnamese economic, VN dollar loss it value quickly, the price of products are strong raising when the income of customer only increase a litter would lead to price become very important factor in term of customer satisfaction. Therefore, price has the huge influences on customer satisfaction in Vietnam market because Vietnamese customers always think about the price of products and service after sales before they consider of purchasing products. Moreover, if the customers feel that the prices for the quality products and service after sales are worthy with the money they spent, they will satisfied. In fact, customers often prefer the cheap prices for the products. They usually compare the products and services after sales between the products with the similar models provided by other competitors. As the result, if the products and the services have the same quality but the price is cheaper compare with other competitors, the customers ‘satisfaction would be increased satisfaction.”
The next question was asked the managers to provide their company price strategies in order to clarify what exactly price influences customer satisfaction in term of business operation.
Manager 1:
“My company price strategies were: we attempt to reduce the price of the products as minimum we could. Our company also offer price promotion for products and service as well. For example, we reduce the price of repairing for customers if they buy spare part of the car. Furthermore, we try our best to reduce repairing time for the cars of customers. “
Manager 6:
“My company has been used some price strategies in order to satisfy our customers: minimum the cost of production, innovate and use material with low price cost, attempt to reduce fuel consumption. All these action has been considered with the purpose of lower product cost. Furthermore, we also try our best to reduce the cost of service maintaining for the car after sales. In addition, we often offer price promotion for particular product in specific time. For example, we offer 1000-1500 USD with some of our products for registration new car which could enhance customer satisfaction. “
Overall about the satisfaction theories, the researchers do not often mention the important of price and its impacts on customer satisfaction. The research found that price is also one of the most important factor as well as product quality and service quality that can have a strong effected customer satisfaction. Most of managers agreed that price has a huge impact on customer satisfaction. The reasons for the agreement of managers were explained by the under economic development of Vietnam economy and the income of customers are still low. Furthermore, most of the cars in Vietnam are imported from oversea so they are suffered very high tax rate and the price for the spare parts of the cars are very expensive. As the result, nearly all of customers always considered price before they purchase a product or service. Anderson, Fornell and Lehmann (1994) were also outlined that price is very important factor for customer satisfaction.The research findings showed that if the producers can provide clearance price of products and services that would leading more satisfaction of the customers. The perceived customers’ clearance price can be referred to price transparency (Diller 1997). Moreover, the managers concluded upon their experiences that customers often compare the price of a product and service with similar models of other competitors. If the price of a product provided from the brand is lower than similar models of other competitors, the customers tend to be more satisfied. Those views were related to Compeau and Grewal (1994) theory with relative price and its effects on customer satisfaction. Almost all managers had the same idea that lower price do not secure for customer satisfaction and high price maybe not makes customers dissatisfied. It has to depend on other factors which related to price such as product quality and service quality. That was contributed for the view of Zeithaml (1988) with the perceived price which can be known as sacrificed of customers.
Additionally, the question was asked the customers to prove that price really affects customer satisfaction and what customers expect from price in order to increase their satisfaction.
Customer 6
“Price is strongly affected my satisfaction and my decision before I consider of purchasing a product because my income is not high. I want to spend minimum of my money for the service after sales. The quality of product or service must be having the suitable price for it. I want to receive more price promotion from the brands and that would increase my satisfaction. The lower price is the better satisfaction for me. “
Customer 11:
“Price is one of the most important for my satisfaction. I always think about the price before I buy a product or use a service. I prefer the lower price but the products and the services must be still guaranteed. The expensive of price of products and services after sales would reduce my satisfaction.”
Customer 14
“Price are not really affected my satisfaction because I am willing to pay the expensive price for the high quality of product and service. If the price is low and the quality of product and service are poor, I will not satisfy. “
Almost of all customers said that price has affected their satisfaction despite that there were some people with high income that did not consider price as an important factor for their satisfaction. That was unexpected finding because there are less literature concerned an important of price on customer satisfaction. All of the customers agreed that the price that they pay should be appropriate with the products and services. That was included in Darke and Dahl (2003) theory. Furthermore, the suitable price which is judged by the customers can be seen as price fairness. Generally, if price is fair, for example, customers may aware that the producers gain less profit from the products and services which will bring the view of price fairness for customers. Consequently, customers’ satisfaction would be increased (Oliver and Swan, 1989). Most of customers had the same view that lower price would lead to more satisfaction and that was also supported for Zeithaml (1988).The research findings showed that customers may be unable to see price dimension as the managers. They perceived price satisfaction very simple according to their opinions and experiences. Customers usually prefer price promotion which is offered by the brands and that would enhance their satisfaction. In literature, there were very little debates about price promotion and it important roles of customer satisfaction. The researchers should mention more when they discuss about the impact of price on customer satisfaction.
4.6 Chapter Summarized
Most of mangers have always concerned about the product quality, service quality and price into their marketing decision in order to satisfy customers. All of the managers agreed that customer satisfaction is the determination factor for the success of the businesses. Therefore, customer satisfaction should be set as a top priority for business operation. They have considered those three factors as very important factor for retaining customer loyalty and attracting new customers. They insisted that understanding the impact of those three factors and using it in effective ways would improve customer satisfaction. As the research findings found that if the companies want to increase customer satisfaction, they must combine those three factors efficiently in business operation and particularly in marketing decision. Moreover, through research findings, most customers agreed that product quality, service quality and price have an impact on their satisfaction. Customers always expect the high quality of products and services from the sellers. Generally, the research found that high quality of product and service with suitable price would lead to more satisfy customers. Through the view of mangers and customers, product quality should be known as the most important factor that has an impact on customer satisfaction.
CHAPTER 5 CONCLUSIONS AND RECOMENDATIONS
5.1 Conclusions
In conclusion, the research project has achieved in investigating the impact of product quality, service quality and price on customer satisfaction. Through the interviews of managers from several car brands and their customers, several of findings and conclusions are drawn.
Most of managers and customers agreed that product quality, service quality and price have the huge impacts on customer satisfaction. It is very important that these factors have been contributed great role into business operation and particularly in marketing aspects in order to improve customer satisfaction. The research found that product quality is the most important factor that affects customer satisfaction. Following the important rank is service quality and then price. Generally, high quality of product and service often lead to high customer satisfaction. Furthermore, low price is also enhances customer satisfaction. In most of empirical studies, the researchers often focus on only product quality and service quality in term of customer satisfaction while there is less concentration on price. This research showed that price is also very important and contributing the great role for customer satisfaction in some cases such as underdevelopment economic countries and low income people. Therefore, in order to be success in business operation or in marketing aspects, we should consider all the impacts of service quality, product quality and price on customer satisfaction.
5.2 Recommendations
Marketing researchers should consider more about price in customer satisfaction theory in order to improve customer satisfaction.
When researchers investigate the impacts of product quality and service quality, they should consider suitable prices with the products and services.
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Appendix A: Interview Managers
1.How long have you been working in your current position?
I have been working in my current position in 7 years.
2.What is your role here and what responsibilities do you have?
I am a marketing manager so I have to responsible with marketing operation of my company.
3. What is your understanding of the meaning of customer satisfaction in term of your business operation?
I think customer satisfaction refers to how your products, prices and your services meet or exceed customer expectation.
4.Do you think customer satisfaction is important with the success of the company and why?
Customer satisfaction is apparently affected the success of the business and it is especially important because customers are the key that bring the profit for the company. Customers would buy more products and perhaps introducing other people to buy it if they are satisfied. That means your company can enhance customer loyalty and attract more new customers. Therefore, your company can be strong development and company’s revenue will increase.
5.What are the factors do you think may affect customer satisfaction of your company?( For example: Service, product and price)
I think all factors such as product, service and price do affect customer satisfaction because all of these factors are necessary to satisfy customers.
6.Do you think product quality has a huge impact on customer satisfaction and why?
I think Product Quality is one of the most important conditions in order to satisfy customers. The customers will be more welcome if a product has a fancy appearance, showing a sense of high quality and enduring as well. For instance, our customers often consider the safety factors (seatbelts, air bags, chassis and material toughness, ect), the design (exterior, interior designs and materials, comfort and versatility, ect) and fuel consumption of the car when they buy our products. If the products can meet customers’ demand, they will be satisfied.
7.Could you explain some examples of product quality strategies of your company in order to increase customer satisfaction?
Some examples of our company Product Quality Strategy to satisfy customer: Our Company often consider the product development process as very important for the success of our business. We always provide various products with different models and styles which can make choices easier for customers. Product innovation is often considered as an important factor of company products’ strategy in order to supply the market with the newest product features and the lower cost as well. The products which are approaching the market must be widely advertised by using all up-to-date sources of communication and must have the appropriately higher quality and suitable price compared with the similar models of the competitors. I think the product development process is necessary and it would bring customer satisfaction.
8.How well do you know about the impact between service quality and customer satisfaction?
Service quality largely influences customer satisfaction. In my experience, customers often perceive service quality as an important factor when they consider of buying the products. The high quality of service can lead to the high of customer satisfaction. In fact, customers often compare service quality between our company and similar competitors in the market. If the quality of service is not as expected of it real performance, customers may dislike the service its means they tend to unaccept the product and customers can be unsatisfied. The company can provide excellent performance quality of service will make customer more impressive and more belief with the company product and service, it would attracts more new customers and retain customer loyalty.
9.What does your company usually do with service quality to satisfy your customers?
My company often offers some service promotions for customers such as increasing quality guarantee time, offer free driving test, free collect customers ‘car to check it every three months…etc. We often train our worker in repairing place which can improve their skill that helps to maintain customer car more efficient. Moreover, we also provide the customer excellent service in our showroom with model showroom designing style, the sellers were welcome customers with respect and nice attitude .The sellers are also kept updating about the new product information in order to introduce customers the products details, that would helps customer easy to choose the car which is appropriate for them. With the service quality provided by my company, customer will be happy and satisfied.
10.Do you think customer satisfaction is affected by price? If yes please give a description for that.
I think price affect customer satisfaction because the customers often consider price before the purchase the product. Moreover, the incomes of Vietnamese customers are still low so that price is very important in term of customer satisfaction.
11.Do you know any price strategy have made by your company that affect customer satisfaction?
My company often offers price promotion such as the money for car registration for some specific models. Furthermore, we try our best to minimize the price for service after sale for customers which can increase customer satisfaction.
12.Have you ever concerned any of these factors in your marketing decision to improve customer satisfaction? Could you explain?
In my experience, I have concerned all product quality, service quality and price in my decision of marketing in order to satisfy customer. I think these three factors are very important factors that have the impacts on customer satisfaction. I always consider all these factors in my marketing decision which can improve customer satisfaction.
13.In your experience what factors do you think has the most effect on customer satisfaction and why?
I think product quality has the most effects on customer satisfaction. In my experiences, customers always concern quality of a product as the determinant factor for their purchase decision. High product quality often relates to high quality of service after sale.
14.Do you think your company should concern all these factors in marketing to improve customer satisfaction and why?
I think my company should always concern these factors in marketing decision as well as in business operation in order to improve customer satisfaction. Customer satisfaction is the key to be success of every single company. Therefore, considering all important factors that have the impacts on customer satisfaction should be the most important mission.
Appendix B: Interview Customer
1.What are you currently doing?
I am a business man.
2.How much is your personal income per month?
My income is about 5000$ USD per month.
3.How much do you willing to pay for a new car?
I would pay around 100.000-140.000$ USD.
4.How long have you been using a car?
I have been using my car about ten years.
5.In your opinion what is the factor you should consider first when you purchase a car and why?
I will consider the design of the car and the quality first when I purchase a car because I think the design and the quality of a car is very important. I want my car has fancy looking and long-lasting as well.
6.What is your understanding of customer satisfaction?
I think the meaning of customer satisfaction is when the customers can received the products and services with high quality from the brands.
7.What are the factors do you think may affect customer satisfaction?(i.e Service quality, product quality, price)
I think all factors such as product quality, service quality and price can affect customer satisfaction. Other factors such as store location, time delivery…etc are also influenced customer satisfaction.
8.What do you think about the impact of product quality on customer satisfaction?
I think Product Quality is directly affected customer satisfaction because if the car with poor quality can leads to unsafety, uncomfortability, less stability, environmental unfriendliness.
9.What were the impacts of product quality of your car brand on your satisfaction? Could you describe in detail?
I think my experience with the car I am driving now (Mercedes E250 ) can appropriately justify my Product Quality statement above : My car has four airbags, Anti-lock braking system (ABS), Electronic Stability Program, Tyre pressure loss warning system, Cruise control with Speedtronic variable speed limiter, Automatic child seat recognition sensor, Pre-Safe® anticipatory safety system, Adaptive Brake System…etc. Those functions make me feel safer. And moreover, I love my car with very nice shaped and color and the design option inside makes me feel comfortable such as leather seat, outside temperature display, rear seat belt status indicator…etc.
10.Do you think service quality affect customer satisfaction and why?
I think service quality strongly affects customer satisfaction. I think high quality of service would bring more satisfaction for customers because customers always expect good service from the sellers. For example, when you come to buy a product if the sellers receive you with nice attitude, you will be more satisfied.
11. Have you ever experienced the effect of service quality of your car brand on your satisfaction? Could you describe it?
I have some experiences of my car brand that affect my satisfaction. Before I buy my car, the seller introduced all the detail of a car which I want to buy. I was advised by the seller about the colour and the option of a car which is suitable with my age and my job. Therefore, I had the right choice for my car. Moreover, the service after sale of my car brand was excellent. My car was checked every 3 months within 2 years guarantee. I was satisfied with the quality of service of my car brand.
10.What do you think about the impact of product quality on customer satisfaction?
I think Product Quality is directly affected customer satisfaction because if the car with poor quality can leads to unsafety, uncomfortability, less stability, environmental unfriendliness.
11.What were the impacts of product quality of your car brand on your satisfaction? Could you describe in detail?
I think my experience with the car im driving now (Mercedes E250 ) can appropriately justify my Product Quality statement above : My car has four airbags, Anti-lock braking system (ABS), Electronic Stability Program, Tyre pressure loss warning system, Cruise control with Speedtronic variable speed limiter, Automatic child seat recognition sensor, Pre-Safe® anticipatory safety system, Adaptive Brake System…etc. Those functions make me feel safer. And moreover, I love my car with very nice shaped and color and the design option inside makes me feel comfortable such as leather seat, outside temperature display, rear seat belt status indicator…etc.
12.How does the price affect your satisfaction?
The price of product and service just lightly affect my satisfaction because my income is quite high. I do not mind too much about the price. I just care about the quality of product and service. However, I think with many people with lower income than me. They will really affected by price.
13.What would you expect from the price to your satisfaction?
I want a suitable price with the right quality of product and service. If the price is high and the quality of product and service do not meet my expectation, I will not satisfy.
14.How do you feel about the product, service and price of your current car brand?
I feel happy with all the product, service and price of my car brand. I would like continuing to buy their product in the future.
15.In your opinion, what factor do you think mostly affect your satisfaction?
In my opinion, the most important factor that affects my satisfaction is product quality. Because if you buy a poor quality of product, you may have to spend more money to repair it after you purchase. Moreover, it may cost you a lot of time with such a poor quality of a car and you can be uncomfortable to use it.
Appendix C- Participant Consent Form
Brunel Business School
Research Ethics
Participant Consent Form
Many thanks for agreeing to participate in my research project. The project has to be completed in part fulfilment of my degree programme and so your assistance is much appreciated.
Consent:
I have read the Participation Information Sheet and hereby indicate my agreement to participate in the study and for the data to be used as specified.
Name of participant or informed third party:
Signature:
Date:
Appendix D- Participant Information Sheet
Brunel Business School
Research Ethics
Participant Information Sheet
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Title of Research:
Customer Satisfaction in Automobile Industry
2. Researcher:
XXXXXX on BSc Business and Management (General), Brunel Business School, Brunel University
3. Contact Email:
4. Purpose of the research:
Investigating the impacts of product quality, service quality and price on customer satisfaction
5. What is involved:
Answering questions via a formal interview
6. Voluntary nature of participation and confidentiality:
The interview process is entirely voluntary and participant can exit at anytime. For any reason if the participants do not want to answer a question, can do so without hesitation. The collected data will only be used as a source for my research and individuality of participants will not be indicated. The data will also be securely kept.