Factors affecting customer satisfaction a case study on g7 coffee

Table of contents Table of contents 1 FACTORS AFFECTING CUSTOMER SATISFACTION A CASE STUDY ON G7 COFFEE 2 1 Why study Customer Satisfaction on G7 coffee? 2 2 Literature review and proposed theoretical[.]

Table of contents

Table of contents 1

FACTORS AFFECTING CUSTOMER SATISFACTION: A CASE STUDY ON G7 COFFEE 2

1 Why study Customer Satisfaction on G7 coffee? 2

2 Literature review and proposed theoretical framework 3

2.1 Customer Satisfaction 3

2.2 Fundamental determinants 4

2.3 Theoretical Framework 5

3 Proposed research problem and hypothesis 7

4 Research process 7

5 Methodology 7

5.1 Data collection method 7

5.2 Data analysis 8

6 Time table: 8

7 Expected Outcomes of the proposed research 9

8 References 10

National Economics University

Faculty of Business Administration

Instructor: PhD Dao Thanh Tung

Enterprise Administration K56 Class, Group 5

FACTORS AFFECTING CUSTOMER SATISFACTION:

A CASE STUDY ON G7 COFFEE

1 Why study Customer Satisfaction on G7 coffee?

Customer satisfaction is important because it provides marketers and business owners with

a metric that they can use to manage and improve their businesses Customer satisfaction surveys give us the insights we need to make better decisions In fact, businesses who measure customer satisfaction are 33% more likely to describe themselves as successful than those who don’t One of the important industries in Vietnam that we need to research on customer satisfaction is coffee

In recent decades, Coffee is one of the highly attractive industries in Vietnam This is reflected in the competition to buy coffee beans from FDI enterprises, to compete for market shares of Nestlé, Trung Nguyen, Vinacafé and more and more coffee shops The coffee retail market in Vietnam reached $ 127.33 million in 2008 and increased to $ 287.34 million in

2012 Mintel is forecast to increase to $ 573.75 million by 2017 Coffee brands will be able to increase sales and profitability if they can understand customer satisfaction

The battle for market share of instant coffee brands in Vietnam may never have an end In order to keep market share, businesses are constantly launching new products, promoting advertising, promoting directly to consumers According to the online survey of Vinasearch (W & S Company), the most used brand is Trung Nguyen, which accounts for 26.3% of the market; the followings are Vinacafé Bien Hoa with 22.8% and Nestle with 21.7%

Trung Nguyen Group is an enterprise operating in the fields of production, processing and trading of coffee; franchise; distribution services, modern retail and tourism Trung Nguyen Coffee is one of the leading brands in Vietnam and is present in more than 60 countries around the world They have diverse products include premium coffee such as mink coffee, roasted coffee, whole grain coffee, fresh coffee and the most popular is G7 instant coffee

We have chosen G7 instant coffee powder from Trung Nguyen Group as a research subject on this thesis This thesis studies these factors behind customer satisfaction when consumer buy G7 coffee It is interesting to study how the consumer satisfy with a specific coffee brand and what has been the effect of these factors

The main purpose of this research is to understand customer satisfaction on coffee brand with following basic objectives:

- Study customer satisfaction on G7 coffee and find out the factors that affect customer satisfaction

- To what extend that these factors influence on Customer Satisfaction and the relationship between 5 factors

- Solution to increase Customer Satisfaction among G7 coffee consumers

2 Literature review and proposed theoretical framework

To get a deeper understanding, we should take a quick look at some definitions of customer satisfaction as well as what a brand is

2.1 Customer Satisfaction

There are many different views on customer satisfaction Customer satisfaction is their reaction to the perceived difference between known experience and expectation (Parasuraman and CTG, 1988; Spreng and CTG, 1996) That is, the customer's known experience when using a service and the results after the service is provided Most specifically, customer satisfaction is the mood or feeling of the customer about a company when their expectations are met or exceeded over the life of the product or service Satisfied customers will gain loyalty and continue to buy the company's products

A common theory to consider customer satisfaction is the "Expectation - Confirmation" theory It was developed by Oliver (1980) and is used to study customer satisfaction with the quality of an organization's services or products That theory consists of two small processes that have an independent impact on customer satisfaction: anticipation of service prior to purchase and perception of service after experience According to this theory, we can understand the customer satisfaction as follows:

- Satisfaction is confirmed if the effect of the service completely coincides or exceeds expectations of the customer

- Disappointment if the efficiency, quality of goods and services are not as expected of the customer

2.2 Fundamental determinants

On the basis of understanding and analyzing customer satisfaction research models that have been applied extensively in many fields, the research objective, and the characteristics of coffee brands in Vietnam, we proposed to study the following factors:

* Product Quality:

Product quality is a concept that characterizes the ability to satisfy a customer's needs There are many definitions of product quality According to Juran, an American professor, quality is

a match for demand According to Japanese professor Ishikawa - quality is the satisfaction of the market demand at the lowest cost In general, if the product does not meet the needs of customers, it will be considered to be inferior quality And conversely, if products satisfy the higher consumer demand, the quality will be seen as higher Quality is one of the most important factors because it directly affects customer satisfaction, which determines the brand's existence

* Price:

Price represents value of a product (usually in the form of money) that customers are willing

to pay to meet their needs A brand that sells higher than other brands is by creating more

value for customers For example, a normal jeans can only be sold for $ 200,000, while a Levis jeans customer can afford to pay a million dollars to buy it In general, price is an important part of marketing mix or sales strategies and should be managed appropriately and help the brand reclaim its value from the value it creates out for the satisfaction of the customer

* Customer Service:

Quality of Customer Service may have strong influence in customer satisfaction, based on:

- Trust: the ability to perform accurate service as promised

- Feedback: the willingness to help the customer quickly and start the service delivery

- Assurance: the characteristics of the staff will create customer confidence, professionalism, courtesy, customer respect, ability to communicate

- Sympathy: service staffs are easy to approach, pay attention to customers

Factors related to the professional level, attitude of employees to perform what is committed, reputation with customers will affect the satisfaction of customers

* Distribution:

For a business, consumption of goods is always an important issue, deciding the existence and development Especially in the current stage, competition is increasingly fierce, the goods must be standardized so that the quality of goods they bring to market must be assured The consumption of goods distributed by the enterprise and implementation of such strategies and distribution plans have great significance to meet customer’s needs

* Brand Awareness:

Brand awareness is the probability that consumers recognize the existence and availability of

a company’s product or services It consists of both brand recognition and brand recall performance

Brand awareness is one of the easiest and most effective ways to promote products, which makes us more competitive if we have a strong and recognize brand Consumers turn to make decision quickly about a product if they know or recognize the brand The more customers can recognize, retain and remember a firms brand the likely fact that they will shop and that firm is greater than shopping elsewhere This is an advantage against competitors as customers overlook at the price and other quality when the trust and know a brand, it became

a part of the customers life style to shop where they are used to and have confident in the brand (Keller 2004, 50-53.)

2.3 Theoretical Framework

In 2013, in order to understand consumer satisfaction for G7 instant coffee, a group of student set up a questionnaire to conduct an actual survey Respondents are 500 consumers in Hanoi from 16 years old and over The result they received was “Trung Nguyen creates a unique flavor that makes the user feel comfortable, relaxed On the other hand, G7 coffee also brings consciousness so that users can concentrate on their work.”

About factors contributing to customer satisfaction, there are 5 factors as following:

Quality 29%

Distribution 11%

Nutritional benefits 26%

Promotion 13%

Product price 21%

The results show that product quality is the most important factor in customer satisfaction when consuming G7 coffee However, this survey ignored two important factors, Customer Service and Brand Awareness, as well as forgot to analyze the impact of different customer groups on the factors Therefore, we decided to do this research, aiming at find out how much does these following factors affect to customer satisfaction And the factors we chose are: Product Quality, Price, Brand Awareness, Distribution and Customer Service

Customer Satisfaction

Product

Quality

Distribution

Customer Service

Price

Brand Awareness

3 Proposed research problem and hypothesis

As mentioned, it is often believed that customer satisfaction provides marketers and business owners with a metric that they can use to manage and improve their businesses However, at present there is still relatively few research on this issue especially in Hanoi Therefore, we will focus on customer satisfaction in purchase decision in Hanoi, particularly for G7 instant powder coffee This research proposal is primarily focused on finding answers to the question of whether customer satisfaction is influenced by such factors Therefore, the problem of the research is that if whether customer satisfaction is explained

by those factors That will lead the research to test the following hypotheses:

H 1: There is positive correlation between customer satisfaction and product quality on G7 coffee consumer

H 2: There is positive correlation between customer satisfaction and price on G7 coffee consumer

H 3: There is positive correlation between customer satisfaction and customer service on G7 coffee consumer

H 4: There is positive correlation between customer satisfaction and distribution on G7 coffee

consumer

H 5: There is positive correlation between customer satisfaction and brand awareness on G7 coffee consumer

4 Research process

There are three steps in conducting the proposed research

Step 1: Determine the most suitable models to be applied in the research

Step 2: Collect data

We will use self-administered questionnaires and Likert scales to collect primary data from Hanoi residents

Step 3: Analyze collected by suitable statistical tools The findings will be drawn out from this phase, so it will end up with writing up the research

5 Methodology

5.1 Data collection method

In this research, we use primary data collected via an Internet survey We used Google forms

to create a self-administered questionnaire This method was chosen because the cost is low,

minimal staff is required, respondents can stay anonymous while answering and respondents can complete the form by themselves

The questions in the questionnaire were based on the theory of factors affecting customer satisfaction on coffee brand The questionnaire makes use of Checklist and Likert scale The questionnaire was published in Vietnamese A link to the questionnaire was posted on Facebook that diminishes random of the sample This leads to the situation that the sample is not representative Data can be collected from population that is conveniently available and willing to participate The downside in this sampling method is that it is the least reliable sampling method and findings cannot be generalized

About secondary data, we used data from Vinasearch Vietnam to get more information about customer satisfaction on G7 instant coffee

5.2 Data analysis

The results of the questionnaire were analyzed with EVIEWS Statistics The program

provides an opportunity to analyze and interpret the results in a numerical form This numerical data can be refined by a statistical method and modeled into a format that supports conclusion making Statistical measures help to find correlations between variables and relations between issues Besides, we also use Descriptive Analysis to analyze the properties

of the research sample such as information on age, gender, monthly income…

6 Time table:

Define research problem and theoretical framework February 20 – February 26 Determine research design, methodology and statistical

tools

February 27 – March 5

7 Expected Outcomes of the proposed research

In theory, we do hope to develop models of factors affecting customer satisfaction, contribute

to compliment previous theoretical models When researching coffee firms in Vietnam, economists often focus on consumer buying behavior and do not pay much attention about customer satisfaction However, in our personal opinion, research on customer satisfaction is extremely important Customers can choose to buy your product, but only when their needs are met will they come back and build loyalty to your product

In practice, the research will probably provide factual information on the variables that may impact customer satisfaction using G7 coffee It can be the basis for Trung Nguyen Group to plan a competitive business strategy and the formation of marketing strategies, so that they can respond most needs of customers in the future

8 References

Arpan, K 2011 Business Fundas Brand personality dimentisons.

http://business-fundas.com/2011/brand-personality-dimensions/ Accessed on 3

January 2015.

Jha, N.K 2008 Research Methodology Abhisek Publications.

Kardes, F Cline, T Cronley, M 2011 Consumer behavior: Science and Practice South-Western Cengage Learning.

Kardes, F Cline, T Cronley, M 2011 Consumer behavior: Science and

Practice South-Western Cengage Learning, (Keller 2004, 50-53.)

Khan, M 2006 Consumer Behaviour and Advertising Management New Age International Kothari, C.R 2004 Research Methodology: Methods and Techniques New Age International.

Mallik, S 2009 Brand management Book Enclave.

Powell, R 1997 Basic Research Methods for Librarians Greenwood Publishing Group.