Impact on Customer Trust and Customer Satisfaction ... · The purpose of this study is to establish...

Impact on Customer Trust andCustomer Satisfaction according to the

Logistics Service Quality of HomeShopping

Soo Ho, Choi11Division of Business,

Sogang University,Seoul Mapo-gu, Korea

January 25, 2018

Abstract

The purpose of this study is to establish a hypothesis andto analyze the research model on the relationship betweenlogistics service quality and trust and customer satisfactionby referring to previous research on logistics service qualityof home shopping. The questionnaire was measured on a5 point Likert scale, it consists of 24 items based on pre-vious research. The survey was conducted for three weeksfrom April 03, 2017 to April 21, 2017. In this study, 173out of 205 questionnaires were analyzed except 32 question-naires which had no experience or insufficient experience.Factor analysis and structural equation analysis were per-formed using SPSS and AMOS. To do this, we propose thefactors related to order quality, delivery quality and returnquality with regard to logistics service quality. And we an-alyze the effect on customer satisfaction after presentingfactors related to customer trust. As a result of the analy-sis, order quality, delivery quality, and return quality wereall supported by customer trust. It is analyzed that cus-tomer trust are supported by customer satisfaction. The

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International Journal of Pure and Applied MathematicsVolume 118 No. 19 2018, 277-289ISSN: 1311-8080 (printed version); ISSN: 1314-3395 (on-line version)url: http://www.ijpam.euSpecial Issue ijpam.eu

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logistics service quality used in home shopping was derivedby dividing the delivery quality, order quality, and returnquality. The logistics service quality used in home shoppingwas derived by dividing the delivery quality, order quality,and return quality. Home shopping companies helped to es-tablish initial trust through logistics service quality for firsttime buyers.

Key Words : Home Shopping, Logistics Service Qual-ity, Customer Trust, Customer Satisfaction.

1 INTRODUCTION

Domestic TV home shopping has continued to grow steadily sincethe launch of Korea Home Shopping (currently GS Home Shop-ping) and 39 shopping (now CJ O Shopping) in 1995 and six homeshopping companies until 2015 in <Figure 1>.

Figure 1: Home shopping market

Competition among home shopping companies is on the risedue to the introduction of the home shopping market, which is theseventh domestic home shopping mall(IM shopping) in 2015. Thehome shopping market has grown rapidly in a short period of timeand has caused various consumer damages. There are mainly ex-aggerated advertisements, false signs, urge to buy impulse, delivery

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and return problems(Y. R. Kang et al., 2009).Consumers buying home shopping mostly rely on information

that is broadcast live on the air. Consumers should use the infor-mation provided by home shopping as a clue to quality evaluationbefore purchasing. Home-shopping vendors need to provide varioustrust clues about logistics-related service quality to give consumersconfidence. The purpose of this study is to investigate the effect oflogistics service quality on customer trust formation and satisfac-tion in home shopping.

2 THEORETICAL BACKGROUND

A. Logistics service quality of home shopping

Home shopping is shopping at home and purchasing the nec-essary goods or services by ordering directly without visiting thestore(S. B. Lee, 2011). In the case of home shopping, it is advanta-geous to purchase goods anywhere regardless of region and it canreduce business expansion, distribution route and cost(D. R. So,2008). The order will not be delivered immediately but will beshipped shortly from two days to a week(Y. J. Seo, 2016). In homeshopping, impulse purchasing easily occurs and after purchasing areal product it is often exchanged and returned if it is a disadvan-tages of a commodity or a different product in broadcast.

B. Trust

Trust is a concept that requires cooperation and interdepen-dence and has fundamental characteristics in all social contexts(Zaltman,G. & Moorman, C., 1988). A concept that is based on the expec-tation that you will get the desired result than the result you arereluctant to(Creed W. D. & Miles R. E., 1996). Trust is a beliefthat builds on the initial stimulus when consumers perceive uncer-tainty or risk(Wang, Sharon., 2004). Trust reflects the feelings orbeliefs of the buyer without any change in behavior or attitude.

C. Customer Satisfaction

Customer satisfaction generally means satisfying customer ex-pectations with customers’ attitude or response after purchasing a

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product or service(Oliver, R. L., 1981). Consumers who use prod-ucts feel dissatisfied if their product quality is below their expec-tations, and feel satisfied if they exceed expectations(Howard, J.A. & J. N. Sheth, 1969). Customer Satisfaction is the viewpointof customer’s cognitive process, emotional reaction, such as theevaluation of the degree of satisfying the customer’s desire, thecustomer’s expectation and actual result, the degree of agreementor disagreement that can be judged from the consumption expe-rience(M. H. Park & H. J. Cho, 1999). Customer satisfaction isthe overall pleasure perceived by consumers as a result of servicesto meet consumers’ expectations and desires(Hellier, P. K. et al.,2003).

3 RESEARCH MODEL AND ANAL-

YSIS METHOD

A. Research Model

The research model is as shown the ¡Figure 2¿.

Figure 2: Research Model

B. Research Hypothesis

Relationship between Logistics Service Quality and TrustIt is analyzed that safe delivery in home shopping affects cus-

tomer satisfaction, and delivery policy and refund policy positivelyinfluence consumer trust formation(T. Y. Jin & N. H. Park, 2012).

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In logistics service quality, delivery quality, order quality and cus-tomer service have an effect on trust(Y. C. Hwang, et al., 2013).If you have a problem with a purchased product, you may feel ananxiety that the exchange or refund of the product may not be eas-ily solved because you purchased it without visiting the store allthe time, but you can overcome it with trust(J. Y. Kim, 2001).

Hypothesis 1 : Logistics service quality will have a positive(+)impact on trust.

H1-1 : The higher the order quality, the more positive impactwill be on the trust.

H1-2 : The higher the delivery quality, the more positive impactwill be on the trust.

H1-3 : The higher the return quality, the more positive impactwill be on the trust.

Relationship between Trust & Customer SatisfactionTrust creates very high exchanges and increases loyalty to cus-

tomers, and such loyalty is created by trust( Morgan, R. M. & S.D. Hunt, 1994). Although there is no purchasing experience, thehigher the level of trust in a particular shopping mall, the greaterthe likelihood of future purchases and the more satisfaction it re-ceives(Frazier, C. J. et al., 1998). The higher the trust, the morefavorable the evaluation of the seller and the more positive the eval-uation of the same experience(Singh, J. & D. Sirdeshmukh, 2000).

Hypothesis 2 : Trust will have a positive(+) impact on customersatisfaction.

4 DATA COLLECTION AND RESEARCH

METHODS

We collected questionnaire data by convenience sample extractionmethod for 20∼30 metropolitan area customers who have experi-ence purchasing home shopping. The questionnaire was measuredon a 5 point Likert scale, it consists of 24 items based on previousresearch. The survey was conducted for three weeks from April 03,2017 to April 21, 2017. In this study, 173 out of 205 questionnaireswere analyzed except 32 questionnaires which had no experienceor insufficient experience. Factor analysis and structural equation

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analysis were performed using SPSS and AMOS. Operational defi-nition of variables is shown in the <Table 1> and <Table 2>.

TABLE I

TABLE II

5 RESEARCH RESULTS

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TABLE III

Reliability analysis is an internal consistency check process inwhich respondents clearly understand the contents of the question-naire and verify that they are responding consistently(C. Y. Jung& I. G. Choi, 2001). In this study, Chronbach’s Alpha coefficient,which is a reliability test method used in social science research, isused as a method to confirm internal consistency. Nunnally,(1978)stated that in the preliminary study, confidence is high when thecoefficient is 0.6 or more, and reliability is 0.7 or more in the actualstudy(Nunnally, J. C., 1978). In <Table 3> Cronbach’s Alpha co-efficient is greater than 0.6, so the measurement tools used in thisstudy have internal consistency. In order to verify the validity ofthe measured variables, exploratory factor analysis was performedusing varimax rotation for principal component analysis.

In <Table 3> independent variable, in <Table 4> exploratoryfactor analysis was used as a parameter. The factor loadings of theresearch are all over 0.5, which is the standard value.

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TABLE IV

In <Table 5>, the AVE and CR values of the measured itemswere above the reference values of 0.5 and 0.7. Therefore, it canbe said that the intensified validity of the variables used in thisstudy is largely secured. For the discriminant validity analysis, weanalyzed the correlation between variables and compared the AVEsquare root value of each variable with the correlation coefficient.As shown in <Table 6>, the AVE square root of the variables hasa larger value than the other correlation coefficients(Czepil, JohnA, 1990). Thus, the validity of discrimination between variables issecured.

TABLE V

This study examines the effect of logistics service quality on con-sumers trust formation and satisfaction in home shopping throughempirical analysis. In order to verify the proposed research model,we use structural equation model using AMOS 18.0. Prior to thehypothesis testing, the appropriateness of the study model was ver-ified through MAXimum likelihood estimation. The results of theanalysis were 35.795 (df = 18, p = 0.007), CFI = 0.963 (> 0.9),NFI = 0.930 (0.9), RMR = 0.028 (<0.05) and GFI = 0.935 (>0.9). Since this was above the recommended standard of fitness,this study model was considered to be appropriate and hypothesistesting was conducted.

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Causal relationship about Logistics service quality, customertrust and customer satisfaction were analyzed through structuralequations. The results are shown in <Table 6> and [Figure 3]. Allhypotheses were supported. Thus, order quality, delivery qualityand return quality were all supported by trust. It is analyzed thatcustomer trust are supported by customer satisfaction.

TABLE VI

Figure 3: Analysis Result of Research Model

6 CONCLUSION AND IMPLICATIONS

A. ConclusionThe order quality, the delivery quality and the return quality

among logistics service quality of home shopping quality have asignificant effect on the trust. When purchasing a home shoppingservice for the first time, there is little information to be obtainedother than the information provided by the home shopping service,so that it is totally dependent on the information displayed in thehome shopping service. Therefore, it seems to have a great influ-ence on the formation of trust. The degree of trust that consumersperceive has an effect on the satisfaction of home shopping compa-nies.

B. Implications

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The logistics service quality used in home shopping was derivedby dividing the delivery quality, order quality, and return quality.Home shopping companies helped to establish initial trust throughlogistics service quality for first time buyers. And to focus on returnactivities for ongoing customer care.

C. Margin PointIn this study, the questionnaire survey was conducted on the 20-

30 generation in the metropolitan area by convenience extractionmethod. For this reason, there are limitations that local residentscan have different results.

References

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[2] Creed W. D. and Miles R. E., 1996, Trust in organizations: aconceptual framework linking organizational forms, managerialphilosophies, and the opportunity costs of controls, See Kramer& Tyler, 16-38.

[3] C. Y. Jung & I. G. Choi, 2001, Statistical analysis using SPSSWIN, Trade executive, Seoul.

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[5] D. R. So, 2008, Korean home shopping companies’ strategy toadvance into the Chinese market, Sungkyunkwan University,Master’s Thesis.

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[8] Howard, J. A. and J. N. Sheth, 1969, The Theory of BuyerBehaviour, J. Wiley and Sons, New York.

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[18] Y. C. Hwang, J. S. Jun, K. H. Kim, and K. H. Kim, 2013, TheEffect to Trust, Satisfaction, Repurchase intention by Logis-tic Service Quality in Online Shopping, Productivity Review,27(1): 479-507.

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