Factors influencing customer satisfaction a study of online shopping in vietnam

Information quality, Website design, Delivery method, Customer service, Merchandise attribute were identified as five important factors influencing Vietnamese customer satisfaction as th

PHAN THANH LONG

FACTORS INFLUENCING CUSTOMER SATISFACTION: A STUDY OF ONLINE

SHOPPING IN VIETNAM

MASTER THESIS OF BUSINESS ADMINISTRATION

HO CHI MINH CITY – 2012

PHAN THANH LONG

FACTORS INFLUENCING CUSTOMER SATISFACTION: A STUDY OF ONLINE

DR NGUYỄN THỊ MAI TRANG

HO CHI MINH CITY – 2012

Students of the eMBA course, University of Economics Ho Chi Minh City for kindly helping me to collect information necessary for the study My special thanks also go to Mr Cao Quốc Việt for his strong support in the implementation of the data analysis and the completion of the thesis

Although the author has tried the best to complete the thesis, but errors could not be comprehensively avoided Therefore, the author is looking forward to receiving the inputs and comments from respectful lecturers and friends, so that the thesis could be more and more improved

Phan Thanh Long

Ho Chi Minh, 28 October 2012

COMMITMENT

I would like to commit that this thesis, “Factors influencing customer satisfaction: a study of online shopping in Vietnam”, was accomplished based

on my independent and serious studies and researches The data was collected

in reality and it has clear origins In addition to that, the data was worthily handled by author and it has never been released in any menu

trust-Ho Chi Minh, 28 October 2012

Phan Thanh Long

Signature:

TABLE OF CONTENT

ACKNOWLEDGEMENT I COMMITMENT II TABLE OF CONTENT III LIST OF TABLE V LIST OF FIGURE V

ABSTRACT 1

CHAPTER 1: INTRODUCTION 2

1.1 Research background 2

1.2 Internet development and application of e-commerce in Vietnam 3

1.2.1 Advantages of Vietnam online shopping environment 4

1.2.2 Difficulties and challenges in Vietnam online market 5

1.3 Problem statement 6

1.4 Research questions 7

1.5 Research objectives 7

1.6 Significances of the research 8

1.7 Research scope 8

1.8 Research method 9

1.8.1 Qualitative method 9

1.8.2 Quantitative method 9

1.9 Structure of the research 9

CHAPTER 2: LITERATURE REVIEW 11

2.1 Introduction 11

2.2 Online shopping customer satisfaction (e-satisfaction) 11

2.3 Proposed conceptual model and hypotheses 14

2.4 Summary 18

CHAPTER 3: RESEARCH METHODOLOGY 20

3.1 Research design 20

3.2 Questionnaire development 21

3.2.1 Independent variables 22

3.2.2 Dependent variable Online shopping customer satisfaction 25

3.3 Questionnaire translation 27

3.4 Research strategy 27

3.4.1 Qualitative pilot study 27

3.4.2 Quantitative pilot study 28

3.5 Targeted population 28

3.6 Research sampling 29

3.6.1 Sample size 29

3.6.2 Sample strategy 29

3.7 Collecting data 29

3.8 Methods of data analysis 30

3.8.1 Data cleaning 31

3.8.2 Reliability assessment of measurement scales (Cronbach alpha) 31

3.8.3 Validity assessment of measurement scales (EFA) 31

3.8.4 Multi Linear Regression (MLR) 32

3.9 Research process 33

3.10 Summary 33

CHAPTER 4: DATA ANALYSIS 35

4.1 Descriptions of sample 36

4.2 Reliability and validity of the measurement scale 37

4.2.1 Reliability (Cronbach alpha) 37

4.2.2 Exploratory factor analysis (EFA) 40

4.3 Testing the research model and the hypotheses 46

4.3.1 Testing correlations of constructs 46

4.3.2 Checking regression assumptions 47

4.3.3 Multi-Linear regression analysis 48

4.4 Summary 53

CHAPTER 5: CONCLUSION AND IMPLICATION 55

5.1 Discussion of findings 55

5.2 Practical implications 56

5.3 Limitations and recommendations 58

LIST OF REFERENCE 60

APPENDIX I 70

APPENDIX 2 74

APPENDIX 3 79

APPENDIX 4 86

GRAPHIC ANALYSIS OF REGRESSION ASSUMPTIONS 86

APPENDIX 5 88

LIST OF TABLE

Table 2.1 Summary of existing researches in e-satisfaction 13

Table 3.1 Survey items used in the study 25

Table 4.1 Statistical report of socio-demographic variables 37

Table 4.2 Cronbach alpha coefficients 38

Table 4.3 Details of five unqualified observation variables 42

Table 4.4 EFA results of independent variables 43

Table 4.5 EFA results of dependent variable 45

Table 4.6 Correlations 46

Table 4.7 MLR results using Enter technique 48

Table 4.8 ANOVA 49

Table 4.9 MLR variables coefficients 49

Table 4.10 Results of testing the hypotheses 51

LIST OF FIGURE Figure 2.1 Proposed conceptual framework 15

Figure 3.1 Research process in the study 35

Figure 4.1 The updated research model 53

ABSTRACT

Vietnam has witnessed rapid development of Internet, in terms of infrastructure, users and internet-based services As for Vietnamese people, Internet gradually becomes a very important channel for shopping, introducing products and services, characterized by the surging numbers of online transactions It inspired the need to study the issues related to the satisfaction of customers for online shopping

The purpose of the thesis is to study the main factors influencing the satisfaction of customers when they carry out the online shopping The study is based on the data related to online shopping customers of the website ebay.vn over the past 6 months

Information quality, Website design, Delivery method, Customer service, Merchandise attribute were identified as five important factors influencing Vietnamese customer satisfaction as they purchase online

CHAPTER 1 INTRODUCTION

This chapter will present overview introduction on the development of Internet, as well as e-commerce applications in Vietnam recently Research problem, research objectives, research questions, extent and method of research will also be presented

1.1 Research background

The coming into being of Internet has been changing the traditional ways of purchasing goods of human being The users have no longer been restricted by time and geographical factors They could actively buy the products and goods regardless of any time and location factors Internet has brought about new methods

of communication and new ways of exchanging everyday information between peoples The ever increasing number of Internet users would also coincide with the development of online purchasing (Joines, Schere & Scheufele, 2003) The fast development of Internet would be explained by the combination of broadband technology and the change of customer behaviour (Oppenheim & Ward, 2006)

Online shopping is a process when users decide to buy products or services

in the Internet economy Internet was developed as a new channel of distribution (Hollensen, 2004) and e-commerce was identified by Smith and Rupp (2003) as a very important factor contributing to Internet revolution Online shopping is one of the main reasons for using Internet and looking for goods, as well as information related to the goods (Joines et al., 2003) Smith and Rupp (2003) also said that thanks to Internet, users could find many providers and reference information, as well as reviews of products they need to buy That is the reason why Internet has become a very competitive environment, when the fights are very tough to attract and keep the customers To influence and keep the customers in a competitive

market, Constantinides (2004) found it would be very necessary to identify the factors or issues influencing customers when they carry out their online shopping

1.2 Internet development and application of e-commerce in Vietnam

According to Vietnam NetCitizens report (Chimigo Vietnam, 2011), in 2010, the number of Internet users in Vietnam accounted for 31% of the total population The percentage is similar to some other countries like China, the Philippines and Thailand Over the past few years, in comparison with other countries in the region,

we have witnessed rapid development of Internet in Vietnam and Vietnam becomes

a country whose Internet development ranked top of the world

In the urban areas (including 12 cities mentioned in Chimigo Vietnam, (2011)), over 50% of urban population had their Internet connections The percentage was even higher in Ha Noi and Ho Chi Minh city Online shopping and auction websites were not regularly used However, we have witnessed strongest development of online shopping activities over the past 3 years

According to information publicized in the Vietnam E-commerce report

2011 by Ministry of Industry and Commerce, 100% of surveyed enterprises were equipped with computers, 98% were connected with Internet with different ways, in which 89% had their broadband technology connections (ADSL) Over 81% of enterprises used e-mails in their business and manufacturing activities, the number was 96% for big enterprises and 80% for small and medium enterprises The application of specialized software was prioritized by enterprises to enhance the efficiency of their activities, such as accounting (88%), human resource management (48%)… Most of enterprises accepted the bookings or made the bookings via electronic devices, in which the number of enterprises accepted the bookings or made the bookings via Internet was ever increasing According to the survey, the percentage of enterprises accepted the bookings via e-mails accounted for 52% and the number was 15% for website-based bookings, the percentage of enterprises made the bookings via e-mails accounted for 53% and the number was

21% for website-based bookings The enterprises were also aware and paid much more attention to particular issues related to e-commerce, such as the security of information and individual information In addition to that, enterprises paid very much attention to the development and promotion of their images and products in the Internet environment by developing their own websites; participating in e-commerce portals, social networks; advertising in e-newspapers and famous searching engines like google.com, yahoo.com… Statistics showed that 38% of enterprises developed their own websites, 14% participated in e-commerce portals

1.2.1 Advantages of Vietnam online shopping environment

Thanks to the rapid development of Internet in Vietnam, both in terms of infrastructure and number of users, e-commerce of Vietnam becomes very potential, attracting many enterprises and individuals selling their services and products to participate in the market for online shopping In addition, Vietnamese users are becoming more familiar with online shopping activities provided by domestic and oversea websites Over the past few years, online shopping enjoys strongest growth rate in comparison with other businesses According to the report carried out by Chimigo Vietnam (2011) in Vietnam NetCitizens report, online shopping volume was doubled since 2007

Vietnamese customers are also more familiar with electronic payment systems, which is a very important factor of online shopping At the present moment, customers have many options to choose the electronic payment gateways when they purchase online Some payment gateways are highly trusted becoming popular, such as NganLuong, BaoKim, VNPay, Payoo, OnePay… Thanks to the development of these electronic payment gateways, Vietnamese individuals and enterprises could easily develop Internet-based websites selling and buying products and services The selling process is automated in a higher level as transactions could

be totally completed online, replacing the previous method in which the products are introduced in the Internet and the cash is collected after the delivery of product

Many big foreign companies are looking for business opportunities in the commerce market of Vietnam Some of the big names in the world, such as Google, Alibaba, Rakuten, eBay and Amazon, quickly promote their appearance in the market In June 2012, Google became member of Vietnam E-commerce Association and had their plans to develop online shopping activities with other members They expected that they could earn 30 millions USD per year in Vietnam market, in which their potential customers are small and medium-sized enterprises

e-The official representative of Alibaba was announced while eBay just bought 20% of Peacesoft Solution’s shares, who is the owner of the website chodientu.com Amazon already approached domestic e-commerce service providers to explore the opportunities to buy the shares or become their partners This would be the catalyst for the development of Vietnam e-commerce

1.2.2 Difficulties and challenges in Vietnam online market

Although the number of Internet users is huge and ever increasing, the majority of them only use Internet to look for information and communications (Vietnam NetCitizens, 2011) Internet plays an important role in choosing and buying the products, but the trust is still low for online payment methods, because only a small proportion number thinks that online shopping is secured Also according to this study, buying Internet-based products is still not popular in Vietnam Only a small number of Internet users regularly log in to online shopping and auction websites Most of them agree that “it is possible to buy numerous products in the Internet”, but many do not think that “online shopping is secured” 60% do not trust online payment systems

The other obstacle is low awareness of Vietnamese people and the unfriendliness of the social environment and business practices Although enterprises are very active in applying information technology and e-commerce, more time spans and necessary steps are needed to achieve advanced business and consumption environment

Online security and privacy is still not ensured It shows a fact that enterprises are aware of the importance of online security for the application of e-commerce

The legal corridor is not yet fulfilled The delivery and transportation services are still weak The quality of human resources is not as good as expectations The online payment systems are under developed These factors are considered as other obstacles of the development of Vietnam e-commerce in the meantime

1.3 Problem statement

The appearance of millions of Internet users at any time would provide potential customers for online retailers Thanks to the development of internet-based technologies, online shopping websites could discover many opportunities to approach a great number of customers at anytime and anywhere, but obstacles also appear as the buyers could easily look for information and choose to buy the products from many other competitive websites simultaneously To survive and develop in the competitive market of online shopping, it is a task for retailing websites in Vietnam to attract potential customers while retaining their own customers Online sellers are requested to understand what Vietnamese customers want and need when they purchase online

The importance of analyzing and identifying factors influencing the satisfaction of customers when they purchase online is very decisive for online shops running in the e-commerce market of Vietnam As there are significant differences between the satisfactions of customers purchasing on the Internet and in the traditional ways, in the meantime the studies concerning the satisfactions of customers purchasing online in Vietnam are still limited It becomes an imperative demand of online retailers to understand the main factors influencing the satisfaction of Vietnamese online customers

1.4 Research questions

This research aims to answer the following questions:

- What are the main factors influencing the satisfaction of Vietnamese customers when they purchase online?

- How do these factors influence the satisfaction of Vietnamese customers when they purchase online?

1.5 Research objectives

This study is conducted to identify factors influencing customer satisfaction towards online shopping in Vietnam It seeks to examine and understand whether factors such as information quality, security and privacy, website design, delivery method, customer service, merchandise attribute influent consumer satisfaction when they purchase online The specific objectives are:

- To examine the relationship between website design and online shopping customer satisfaction

- To examine the relationship between security and privacy and online shopping customer satisfaction

- To examine the relationship between information quality and online shopping customer satisfaction

- To examine the relationship between delivery method and online shopping customer satisfaction

- To examine the relationship between customer service and online shopping customer satisfaction

- To examine the relationship between merchandise attribute and online shopping customer satisfaction

1.6 Significances of the research

The results of the study are practically meaningful for e-commerce in Vietnam Assist managers and traders of Internet-based products/services to master the main factors influencing the satisfaction of Vietnamese customers when they purchase online The results of the study will provide necessary measures to improve the online shopping satisfaction of customers, help the sellers to keep their current customers and attract new potential ones, so that they can survive and further develop in the potential but highly competitive market of e-commerce in Vietnam

The study will also enrich necessary knowledge for people who are doing their e-commerce business in Vietnam, which is very new and lack of official studies on this field in Vietnam

1.7 Research scope

The study would focus on the satisfaction of Vietnamese customers when they purchase online, regardless of the geographical locations of the buyers Furthermore, to ensure that the surveyed customers could be able to provide adequate information for the study, only customers who has purchased online over the past 6 months close to the day that the study was carried out was chosen to participate in the survey

The targets of the study are customers who made purchases for products introduced in website www.ebay.vn, the partner website of this study The website are leading the ranking of Vietnam top online shopping retailers thanks to the great number of successful transactions and customer visits daily Therefore, the study is also applicable for the B2C (Business to Customer) model of online shopping only, not the others, such as B2B (Business to Business) or C2C (Customer to Customer)

Previous studies carried out in other countries regarding the satisfaction of customers for online shopping already identified the main factors influencing the

satisfaction of customers In this study, the author would only choose suitable factors to test with the online market of Vietnam This seemed to be the most appropriate choice considering the limitations in both time and resources

1.8 Research method

Subjects of study are customers who have made online purchases over the past 6 months Due to the fact that the study is carried out thanks to the cooperation and support of PeaceSoft Solutions Corporation, the scope of study is linked with customers of the top online shopping website of Vietnam which are under the ownership of PeaceSoft Corporation: www.ebay.vn, regardless of customer’s geographical locations

The study was carried out within 2 steps concerning two different methods:

1.8.1 Qualitative method

The author would use the qualitative method by carrying out group discussions and deep interviews made with 5 students studying in the same course who had experiences in online shopping The purpose of this step is to adjust and amend the translated questionnaire suitable with the subjects and purposes of the study

1.8.2 Quantitative method

Quantitative study would be carried out based on the data collected from the questionnaire established in Step 1 Quantitative study is implemented to evaluate the scale, verify the theoretical model The scale is preliminarily tested the reliability and validity using Cronbach alpha and exploratory factor analysis carried out by the SPSS 18.0 software Correlation analysis and multi-linear regression analysis would be used to test the proposed model and the hypotheses of the study

1.9 Structure of the research

Chapter 1: Introduction

This chapter presents a background of Internet usage and e-commerce in Vietnam Introduction chapter will also provide problem statement, the research questions, research objectives, as well as extent and methodology of the study

Chapter 2: Literature review and proposed research model

This chapter presents the theories behind online customer satisfaction It will discuss results of the previous researches relating to online consumer satisfaction in order to continue with the identification of the factors that influence consumer satisfaction when they purchasing online The research framework and hypotheses will also be proposed in this chapter

Chapter 3: Research methodology

This chapter will present how this research has been conducted in order to collect primary data and reach the objectives of the research

Chapter 4: Data analysis and results

Analysis is conducted based on the collected data to test the hypotheses and answer the research questions

Chapter 5: Conclusions and implications

This chapter will present the conclusions that were drawn from the analysis

of the research It will also discuss the results; provide practical implication, and possible directions for future research

CHAPTER 2 LITERATURE REVIEW

This chapter presents the theories behind consumer satisfaction It will also discuss online shopping customer satisfaction in order to continue with the identification of the influencing factors The research framework and hypotheses will also be proposed in this chapter

2.2 Online shopping customer satisfaction (e-satisfaction)

The fundamental understanding of relevant factors influencing online customer satisfaction is very important for e-commerce (MacKinney et al., 2002) Szymanski and Hise (2000) proved that convenience, website design and financial security are major factors influencing e-satisfaction, while product information would have minor impacts on online customer satisfaction Jun et al (2004) identified six factors which are closely linked with e-satisfaction, namely reliable/ prompt response, access, ease of use, attentiveness, security and credibility Studies

of Jun et al (2004) found that reliable/ prompt response, access, ease of use and attentiveness would strongly influence online customer satisfaction in the online shopping environment

Studies also show that circumstances and behaviors of online shopping are very different with traditional purchasing carried out in retailing shops (Degeratu et al., 2000; Lynch and Ariely, 2000; Shankar et al., 2001, 2003; Ranganathan and Ganapathy, 2002; Heiner et al., 2004) (cited from Liu et al., 2008) It can be expected that the key drivers of customer satisfaction and retention in the Internet economy may also be different from those in the traditional economy

Liu et al (2008) conducted an empirical study on online shopping customer satisfaction in China and discovered that information quality, customer service, website design, transaction capability, security and privacy, delivery, merchandise attribute and payment are major factors influencing the satisfaction of customers While the subject of satisfaction has been discussed extensively in the traditional retailing literature (Mason and Bearden, 1979; Oliver, 1981; Anderson et al., 1994; Terblanche and Boshoff, 2001a,b; Johan, 2006; Ofir and Simonson, 2007) (cited from Liu et al., 2008), the exploration of dimensions and determinations of satisfaction under e-commerce context is at a nascent stage (Heiner et al., 2004) Recently, some researchers have started to investigate how the attributes of a website will influence customers’ satisfaction These studies have presented various characteristics as important factors for an effective B2 C e-commerce website; however, up to now there is no consensus on how this affects online customer satisfaction (Schaupp and Be langer, 200 )

Table 2.1 summarizes several previous studies of the determinants of online shopping customer satisfaction (Cited from Liu et al., 2008)

Table 2.1 Summary existing researches in e-satisfaction

Independent

variable

Key references Dependent variable

Convenience - Szymanski and Hise

- Kim and Lim (2001)

- Szymanski and Hise (2000)

- Kim and Lim (2001)

- Kim and Lim (2001)

- Kim and Stoel (2004)

- Consumer attitudes and satisfaction

- Consumer attitudes and satisfaction

- Consumers’ satisfaction with internet shopping

- Shopper satisfaction of apparel website

Speed

Response time

Transaction

capability

- Kim and Lim (2001)

- Kim and Stoel (2004)

2.3 Proposed conceptual model and hypotheses

Based on the conceptual model proposed by Liu et al (2008) regarding factors influencing online customer satisfaction in China, within the framework of the study, considering the adaptability with online shopping environment in Vietnam, the author chose information quality, customer service, website design, privacy, delivery and merchandise attribute and evaluates influences of these factors

on online shopping customer satisfaction in context of Vietnam It would be appropriate concerning the limitation of time and resources of the author while carrying out this study Figure 2.1 shows the proposed research model for this research

Figure 2.1 Proposed research model

Information quality: Szymanski and Hise (2000) realized that the customer

satisfaction on online shopping is greatly influenced by the quality of information attached with the products provided in the website

Website information is often monitored rather than just read in details Useful and reliable information is very important for customers when they get access to shopping websites (Szymanski and Hise, 2000) Other studies also identified that information content should be precise, relevant and complete It is the role of the online store to provide information of the products, transaction and services Higher information quality would result in better buying decisions and improve the satisfaction of customers (Peterson et al., 1997)

Privacy and security: In comparison with traditional economies, online

customers extend their attentions to the necessity of privacy/ security (Culnan, 1999; Friedman et al., 2000; Grewal et al., 2004) (cited from Liu et al., 2008) The

inadequateness of infrastructure, the lack of trust, concerns about privacy and security often result in the sale losses (Yianakos, 2002; Grabner-Kraeuter, 2002) (cited from Liu et al., 2008) Privacy refers to the rights of individuals and organizations to decide for themselves when, how and to what extent information about them is to be transmitted to others (Grandinetti, 1996) The lack of privacy on the websites would make online shoppers worry about the possible reveal of transactions and personal information (June et al., 2004)

Website design: Previous studies proved that the user-friendliness of the

website interface plays an important role in ensuring the success of trading via websites Del Galdo and Nielsen (1999) called upon the improvement of website appropriateness, because the lack of appropriateness would lead to dissatisfaction of users and websites could not be successfully developed in a sustainable manner Gummerus et al (2004) defined that user interface is an environment for the interactions between users and online shopping providers Srinivasan et al (2002) proved that the interaction of e-commerce would be closely associated with the loyalty of customers In addition to that, Alam and Yasin (2009) found in their studies in Malaysia that website design is clearly linked with the satisfaction of customers Website design is regarded as a major factor influencing online shopping satisfaction (Lee and Joshi, 2007) Zhang et al (1999) evaluated website quality in the perspectives of satisfaction and dissatisfaction of users Their results showed that website design features can be regarded as the hygiene and motivator factors that contribute to the user dissatisfaction and satisfaction with a website

Delivery method: The lack of physical interactions between sellers and

buyers is one of the major weaknesses of e-retailers Massad et al (2006) proved that delivery performance is the key factor for keeping customers satisfied with online shopping stores Liu et al (2008) said that the separation between goods consumption and productions, as well as the delays of goods delivery could be found in the environment of e-commerce The delivery delay would have negative impacts on satisfaction (Liu et al., 2008) Online stores should pay attention to the

improvement of customer shopping experience by providing safe, secure, reliable and low-cost freight services, included by effective delivery options, the prompt response and update of delivery status, as well as timely delivery as requested (Massad et al., 2006) Managers of online stores should also help customers to easily check and monitor the delivery progress An informed customer is likely to

be a more satisfied customer (Massad et al., 2006)

Customer service: Post-purchase evaluation can be influenced by the

efficiency of logistics and customer service The most common types of complaints about Internet transactions include refund and billing disputes, return and exchange policies, defective products, and poor customer service (Chen and Chang, 2003) Consumers want careful, continuous, useful communication across geographic barriers (Lohse and Spiller, 1998) In the e-commerce environment, not only is the consumption of goods separated from production, thus making it necessary for goods to be delivered to consumers before consumption, there is also a delay in the delivery of goods Delayed delivery may have a negative effect on satisfaction

Merchandise attribute: merchandise attribute comprise of the diversity and

prices of the products, which are very important for the buying decisions Szymanski and Hise (2000) indicate that wider assortment of products may be attractive to customers and e-satisfaction would be more positive when online stores offer superior product assortments Although authors of some previous studies stated that price sensibility in the online environment could be lower than offline environment (e.g., Degeratu et al., 2000; Lynch and Ariely, 2000; Shankar et al., 2001) (cited from Liu et al., 2008), one most commonly cited reason for online shopping is price, and many early online marketers used price as bait to lure consumers to their sites (Chen and Chang, 2003)

According to the proposed model and literature review, the following hypotheses are constructed to be assed in Vietnam online market:

- H 1 : Website design is positively related to online shopping customer

This research consulted the theoretical model of online shopping customer satisfaction proposed by Liu et al (2008), considering to the limitations of time and resources, the author subtracted 2 factors including transaction capability, payment and choose 6 factors which are most suitable for Vietnamese e-commerce market in the meantime, namely information quality, customer service, website design, privacy/ security, delivery, merchandise attribute, so that the influences of these

factors on the customer satisfaction when they purchase online could be verified in the context of Vietnam

According to the proposed conceptual model and theoretical review from existing studies, six hypotheses for this research were also constructed and presented in this chapter

CHAPTER 3 RESEARCH METHODOLOGY

The content of this chapter is to present the methodology used in this study including research design, questionnaire development, translation of the questionnaire, research strategy, targeted population, sampling, data collection and methods of data analysis and research process

in the measurement scales Based on the results, the draft questionnaire would be adjusted to prepare for the next step of pilot test

Step 2 is conducted using online survey method in which interviews were made with 110 participants (n=110), who are subjects of the study The purpose of this pilot quantitative test is to evaluate the preliminary consistency of the measurement scales, the response rate of the interviewees and quality of the answers Based on the results, necessary adjustments were made and the final questionnaire could be completed for the main study in next step

After the pilot study, the main study was conducted using online survey method supported by Google Docs (online web-based survey at docs.google.com) The purposes of this study were to assess the measurement scales, to test the hypotheses and to confirm the proposed research model

With online survey, the respondent completed the questionnaire without assistance of an interviewer Online survey was selected as it proved to be an

appropriate research method for this study It has several advantages over traditional surveys: not restricted to a particular geographical location, lower costs, faster responses (Shankar et al., 2003), more effective in identifying and seeking online shoppers (Szymanski and Hise, 2000), and more interesting (Edmonson, 1997)

The author distributed online surveys via e-mail to the selected e-mails address of customers listed in the database of the website www.ebay.vn, who satisfy the requirements of the study subjects: people who had online shopping experiences

in website www.ebay.vn in past 6 months

3.2 Questionnaire development

A questionnaire or called measuring instrument is a formalized set of questions for obtaining information from respondents (Malhotra, 1996) Any questionnaire has three specific objectives First of all, it should transform necessary information related to the study into a list of questions that the respondents could answer Secondly, the questionnaire should bring about good dynamic, thus encourage respondents to participate in the interviews and complete the questionnaire Thirdly, the questionnaire should ensure minimum response errors (Malhotra, 1996)

The survey instrument in this study contained 2 main sections: The first section comprised of 3 questions regarding gender, educational level and latest purchasing date of respondents The second part consisted of total 38 items divided into 6 groups responding 6 factors requiring measurement in the research model: website design, information quality, customer service, delivery method, security and privacy and merchandise attribute In section 2, the respondents were asked to identify the extent to which they agree/disagree with the statements related to their latest online shopping experience in website www.ebay.vn Each item was measured on seven-point Likert-type scales on which 1 represents “strongly disagree” and 7 represents “strongly agree”

3.2.1 Independent variables

Independent variable is also known as the predictor variable It is one that influence the dependent variable either in a positive or negative ways (Cavana, Delahaye, & Sekaran, 2001) The independent variables studied in this research are Website design, Information quality, Customer service, Delivery method, Security and Privacy, Merchandise attribute

3.2.1.1 Website design

Website design would be evaluated based on 4 criteria: navigation, website structure, color combination and ease of use The total of 10 items were introduced from Muyllea et al (2004), Jeong et al (2003) and Kim and Stoel (2004)

(1) I like the layout of the website

(2) The start page leads me easily to the information I need

(3) The start page tells me immediately where I can find the information I am looking for

(4) I found it easy to move around in this Website

(5) The Website and all of its linked pages work well

(6) This Website uses good color combinations

(7) I like the color combination of this website

(8) I feel happy when I use the website

(9) The website is easy to use

(10) The website is user friendly

3.2.1.2 Security and Privacy

Security and Privacy scale were evaluated by 4 items taken from Wolfinbargerhe and Gilly (2003)

(1) The website has adequate security features

(2) I feel secure giving out credit card information at this website

(3) I feel I can trust this website

(4) I feel safe in my transactions with this website

3.2.1.3 Information quality

Information quality would be evaluated based on 4 aspects: information accuracy, information comprehensibility, information completeness and information relevancy This group consists of 7 items which were adapted from the items initially developed by Jeong et sl (2003) and Muyllea et al (2004)

(1) I believe the Website provides accurate information to potential customers like

me

(2) The information provided at the Website is clear to me

(3) The information provided on the Website is easily understandable

(4) The information provided at the Website is reliable

(5) The information on the Website is complete for my purchase decisions

(6) I can find all the detailed information of the goods I need

(7) The information in the Website is relevant

3.2.1.4 Customer service

This research consulted the study of Wolfinbargerhe and Gilly (2003) in

evaluating customer service using 3 confirmed items

(1) Customer service personnel are always willing to help you

(2) Inquiries are answered promptly

(3) The company is ready and willing to respond to customer needs

3.2.1.5 Delivery method

Delivery method consists of 4 items, while two of them were adapted from Wolfinbargerhe and Gilly (2003) and other two from Liu at el (2008)

(1) The product is delivered by the time promised by the company

(2) You get what you ordered from this site

(3) The items sent by the site are well packaged and perfectly sound

(4) I am satisfied with the delivery mode of the website (post, express delivery, home delivery…)

3.2.1.6 Merchandise attribute

Merchandise attribute was evaluated from two dimensions: product variety and product price Based on the study of Szymanski and Hise (2000), 4 items were used to evaluate the product variety concerning 2 criteria: number of offerings and variety of offerings Furthermore, Liu et al (2008) established 2 items used to evaluate product Price Totally, six items were used to evaluate merchandise attribute in this research

(1) The general pricing of the website’s goods is relatively low (goods price plus delivery price)

(2) This website has a bigger offering of lucky draw and discount than similar websites

(3) The product of other similar websites can be found at this site

(4) The product range of this website is complete

(5) Most of the goods I need can be found at this website

(6) There are more choices for goods of a particular type at this site

3.2.2 Dependent variable Online shopping customer satisfaction

The dependent variable in this research is online shopping customer satisfaction Satisfaction scale consists of four items taken from Oliver (1981), referring to a customer’s degree of satisfaction upon completion of an online shopping experience

(1) If I had to do it over again, I’d make my most recent online purchase at this website

(2) My choice to purchase from this website was a wise one

(3) I have truly enjoyed purchasing from this website

(4) I am satisfaction with my most recent decision to purchase from this Website

The final item list was presented in the Table 3.1 and the completed questionnaire was presented in Appendix 1

Table 3.1 Survey items used in the study

WD WEBSITE DESIGN

WD1 I like the layout of the website

WD2 The start page leads me easily to the information I need

WD3 The start page tells me immediately where I can find the information I am looking for

WD4 I found it easy to move around in this Website

WD5 The Website and all of its linked pages work well

WD6 This Website uses good color combinations

WD7 I like the color combination of this website

WD8 I feel happy when I use the website

WD9 The website is easy to use

WD10 The website is user friendly

SAP SECURITY AND PRIVACY

SAP1 The website has adequate security features

SAP2 I feel secure giving out credit card information at this website

SAP3 I feel I can trust this website

SAP4 I feel safe in my transactions with this website

IQ INFORMATION QUALITY

IQ1 I believe the Website provides accurate information to potential customers like me

IQ2 The information provided at the Website is clear to me

IQ3 The information provided on the Website is easily understandable

IQ4 The information provided at the Website is reliable

IQ5 The information on the Website is complete for my purchase decisions

IQ6 I can find all the detailed information of the goods I need

IQ7 The information in the Website is relevant

CS CUSTOMER SERVICE

CS1 Customer service personnel are always willing to help you

CS2 Inquiries are answered promptly

CS3 The company is ready and willing to respond to customer needs

DM DELIVERY METHOD

DM1 The product is delivered by the time promised by the company

DM2 You get what you ordered from this site

DM3 The items sent by the site are well packaged and perfectly sound

DM4 I am satisfied with the delivery mode of the website (post, express delivery, home

delivery…)

MA MERCHANDISE ATTRIBUTE

MA1 The general pricing of the website’s goods is relatively low (goods price plus delivery

price)

MA2 This website has a bigger offering of lucky draw and discount than similar websites

MA3 The product of other similar websites can be found at this site

MA4 The product range of this website is complete

MA5 Most of the goods I need can be found at this website

MA6 There are more choices for goods of a particular type at this site

OCS ONLINE SHOPPING CUSTOMER SATISFACTION

OCS1 If I had to do it over again, I’d make my most recent online purchase at this website

OCS2 My choice to purchase from this website was a wise one

OCS3 I have truly enjoyed purchasing from this website

OCS4 I am satisfaction with my most recent decision to purchase from this Website

3.3 Questionnaire translation

Surveys were translated and back-translated into Vietnamese in line with cross cultural translation procedures (Harkness & Schoua-Glusberg, 1998) Translation procedure used the committee approaches Committee or parallel translation requested the participation of some translators Based on the original questionnaire, as instructed by Brislin (1980) (cited in Harkness & Schoua-Glusberg, 1998), the translations were simultaneously and independently carried out After that, the translators compared different translation versions and chose the final one

In this study, author used the committee with 2 friends in same MBA course as the translators

According to Harkness & Schoua-Glusberg (1998), the term back translation was the method transforming the translated version back to the source language The purpose of back translation was to compare and refer the translated version with the source language version, so that the quality of the translated version could

be evaluated

3.4 Research strategy

3.4.1 Qualitative pilot study

When the translation of the questionnaire was completed, the pretest or called alpha test would be carried out with the participation of 5 persons studying in the same MBA course who are experienced in online shopping Participants of this study would not be interviewed in the main study in next step The comments related to the translation of the questionnaire were mainly suggestions concerning words and phrases that make the translations better and the questions more understandable for Vietnamese respondents, e.g “Giá cả chung của các mặt hàng trên EBAY.VN tương đối thấp” revised to “Giá cả chung của các mặt hàng trên EBAY.VN tương đối hấp dẫn”, “Nhân viên chăm sóc khách hàng của EBAY.VN luôn vui lòng hỗ trợ bạn” revised to “Nhân viên chăm sóc khách hàng của

EBAY.VN luôn sẵn lòng hỗ trợ bạn”, “EBAY.VN cung cấp đầy đủ thông tin cho quyết định mua hàng của bạn” revised to “EBAY.VN cung cấp được đầy đủ thông tin cần cho quyết định mua hàng của bạn” After the revision finished, the author had the final draft questionnaire

3.4.2 Quantitative pilot study

In this quantitative pilot study (or beta test), the author used the final draft questionnaire completed in the above qualitative pilot study to carry out interviews with subjects of the study The author distributed 4,000 e-mails containing the questionnaires to 4,000 e-mail addresses of customers provided by www.ebay.vn, comprising of people who have made the purchasing over the past 6 months Based

on the data collected, the evaluation of the questionnaire was the processed, e.g did the subjects of the study understand the questions correctly? Did they have information to answer? Were they willing to provide information? In this step, the author received 110 answered questionnaires from the respondents The reliability and validity of the measurement scales was preliminarily tested with collected data using Cronbach alpha and exploratory factor analysis Based on the preliminary results, the author made necessary adjustments, so that the final questionnaire could

be ready for the main study

The results received from this quantitative pilot study show that the questionnaire was suitable with the study’s subject and measurement scale was preliminarily satisfied the criteria of reliability and validity

www.ebay.vn is regarded as a version of www.ebay.com reserved for Vietnamese people in Vietnam with the frequent access of about 200,000 visitors in average daily According to statistics of PeaceSoft, more than 80,000 customers have made successful transactions over the past 6 months Therefore the targeted population for this study is about 80,000

3.6 Research sampling

3.6.1 Sample size

In this study, the author used the theory proposed by Hair et al (2006), in which the sample size should be at least 50, at best 100 and the observation/items rate should be 5:1, so that the exploratory factor analysis could be applied It means that each item would require at least 5 observations In addition, Tabachnick & Fidell’s (1989) (as cited in Green, 1991) suggested that number of subjects for each predictor or independent variable in regression analysis should be 5-to-1 In this study, due to the fact that there were a total of 38 items in the questionnaires, the required sample size of this study was 190 Therefore the total of 274 valid responses for sample size the author received in this study was satisfied

3.6.2 Sample strategy

The author selected customers who purchased online on website www.ebay.vn in past six months as population in this research Samples were selected based on non-probability convenience sampling method Convenience sampling involves using samples that are the easiest to obtain and is continued until the sampling size that is need is reached The bias with the convenience sampling is

that it is hard to generalize to the wanted population (Saunders et al., 2007)

3.7 Collecting data

As mentioned in the methodology section of the Chapter 1, the author used online survey tool of Google Docs (docs.google.com) in order to survey the research subjects The Google online survey allows respondents answering the

questionnaire over the Internet and it has several advantages:

- The answers of the questionnaire would be automatically updated in the spreadsheet application of Google Docs in the form of encoded data, so that the errors of data inputting could be minimized

- Google online survey also enables interviewers to download the result of surveys in the Excel formatting (.xls, xlsx), so that the data analysis software could be easily used (e.g SPSS)

- In case the option “required” was formed in the questions raised by Google online survey, respondents would be asked if any answer was missed, so that the missing of questions would be avoided in the step of data cleaning

In this study, the author collected data by distributing e-mails containing questionnaire to 4,000 e-mail addresses in the quantitative pilot test and 10,000 e-mail addresses in the main qualitative study These are e-mail addresses of customers who have purchased in the website www.ebay.vn over the past 6 months The e-mail addresses were filtered and provided by www.ebay.vn

To encourage customers to fill in the questionnaire, the author cooperated with www.ebay.vn to award the shopping vouchers worth 200,000 VND for respondents who provided valuable answers for the study The codes of voucher would be sent to the e-mail addresses of customers after completing the study

3.8 Methods of data analysis

Descriptive Statistic is the statistical technique that used in the analysis of this research Data collected from questionnaires was analyzed using SPSS version 18.0 For data processing, four statistical techniques were used for different purposes These included frequency, descriptive statistics, validity and reliability test, correlation analysis and multiple linear regression analysis

3.8.1 Data cleaning

Thanks to the use of online survey tool of Google Docs for interviewing subjects of the study, the frequent errors of data cleaning could be avoided (e.g missing data, invalid inputting data…) Web-based surveys require the least amount

of data cleaning (Sue & Ritter, 2004) All of questions were pre-defined multiple choices questions, where the respondents had to select the predefined answers Therefore, data cleaning was mainly done for all questions The author also reviewed the reverse-scored questions to double check if they were logically answered Based on the evaluation criteria, the author eliminated 8 irrelevant received questionnaires, because the answers only responded with one single value for all questions Due to the fact that the author put “required” option for all questions, the respondent could not submit the survey if all questions had not been fully answered, meaning there were no possible missing-answer response Finally, the author got 274 usable responses drawn from the total of 282 received responses

3.8.2 Reliability assessment of measurement scales (Cronbach alpha)

Reliability refers to the extent to which a scale produces consistent results if repeated measurements made (Malhotra, 1996) A popular approach to measure reliability is to use the coefficient alpha (Malhotra, 1996) The Cronbach alpha reliability coefficient is traditionally reported in statistics as the measure of internal consistency of responses across the set of items (Schumacker & Lomax, 2004) This method allowed the analyst to get rid of irrelevant variables and restrict junk variables in the scales For variables that the item-total correlations were higher or equivalent to 30, they would be qualified (Nunnally & Bermstein, 1994) A measurement scales would be considered reliable if Cronbach alpha coefficient varies from 70 to 80 If the Cronbach alpha is bigger or equivalent to 60, the scale

is acceptably reliable (Nunnally & Bernstein, 1994)

3.8.3 Validity assessment of measurement scales (EFA)

After the reliability of the scale was evaluated by using the Cronbach alpha

analysis and the unreliable variables were eliminated, the author implemented the exploratory factor analysis (or shorted as EFA) to assess the validity of the scales and at the same time downsize and summarize the data The EFA method would help to identify the collection of variables necessary for the study matters and find out the relations between variables

3.8.4 Multi Linear Regression (MLR)

Multiple Linear Regression analysis will be used to test the hypotheses in this study Seven variables (Information quality, Website design, Delivery, Security and Privacy, Customer service, Merchandise attribute and Online shopping customer satisfaction) were entered Multiple regressions will determine the significant relationship between dependent and independent variables, the direction

of the relationship, the degree of the relationship and strength of the relationship (Sekaran, 2006) Multiple regression are most sophisticated extension of correlation and are used to explore the predict ability of a set of independent variables on dependent variable (Pallant, 2001) The data was edited to detect errors and certify that data quality standard is achieved Proportions were the summary measured used

to describe the dependent and independent variable

Based on the six proposed hypotheses, it gives direction to assess the statistical relationship between the dependent and independent variables The convention of p-value has been set as of 5% i.e .05 used as evidence of a statistical association between the dependent and independent variables

Data analysis also involved the construction of a model that captured some

of the major elements that impact online shopping consumer satisfaction The researches question was addressed and all the variables that impact online customer satisfaction were considered

3.8.4.1 Correlation Analysis

Correlation test used for inferential statistics The Pearson correlation will be

used to measure the significance of linear bivatriate between the independent variables and dependent variables thereby achieving the objective of this study (Sakaran, 2006) Correlation is a bivatriate measure of association (strength of the relationship) of the relationship between two variables It varies from 0 (random relationship) to 1 (perfect linear relationship) or -1 (perfect negative linear relationship) it is usually reported in term of its square (r2) interpreted as percent of variance explained (Hair et al, 2006) the used of partial correlation is usually restricted to simple model of 3 or 4 variables, 5 most (Cohen, 1983)

3.8.4.2 F-test

The function of F-test is to see and understand the influence of both independent variables toward dependent variables Steps of this test:

- Create the hypothesis formulation


o H0: b1 = b2 = b3 = b4 = 0, there was no influence that is significant from the independent variable (X) together against the dependent variable (Y)

o Ha: b1 ≠ b2 ≠ b3 ≠ b4 ≠ 0, there was influence that is significant from the independent variable (X) together against the dependent variable (Y)

- Determine the level of the significant of 5%

- Tested the hypothesis with the provision If the significant < 05; so Ha

accepted and H0 rejected, if significant level p-value > 05; so Ha rejected and