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An application of the American Customer Satisfaction Index Model (ACSIM) in the Nepalese Mobile Phone Sector

Forschungsarbeit 2014 33 Seiten

BWL - Marketing, Unternehmenskommunikation, CRM, Marktforschung, Social Media

Leseprobe

CONTENT

ABSTRACT

Introduction

1. Theoretical Framework
1.1. American Customer Satisfaction Index Model
1.2 Antecedents of Customer Satisfaction
1.3. Consequences of Customer Satisfaction
1.4. Research Questions

2. Research Methodology
2.1. Data Analysis and Results
2.2. Outer or Measurement Model Evaluation
2.3. Goodness-of-fit indexes
2.4. Inner Model Specification
2.5. Discussion and Conclusions
2.6. Limitations and Directions for Future Research

References

APPENDIX

ABSTRACT

Nepalese mobile phone market is one of the fast growing businesses with the penetration rate of at least 67.92% for GSM mobile services. Mobile phone providers have also been competing to offer dynamic services to customers. By doing this research, it is expected to offer inputs to enhance customer satisfaction with mobile services in Nepal. The term ‘customer satisfaction’ has become an emerging issue for academic research as business organizations recognize that customer satisfaction is the only way to win in the given tough competitive business world. The aim of this paper is to measure the antecedents and consequences of overall customer satisfaction with mobile services in Nepal. This study is probably the first of its kind in Nepal, which uses standard customer satisfaction measures (American customer satisfaction index model, (ACSIM) to examine the customer satisfaction with mobile services. It uses a structured questionnaire to collect the data from 242 young mobile users from two colleges in Nepal. Based on the observation, it is found that the influencing antecedents of customer satisfaction are customer expectation, perceived quality and perceived value. Similarly, it is also found that highly satisfied customers are more likely to repurchase and higher price tolerance to price increases by current mobile services provider or price decreases by rival. The result of this study is more applicable to young adult mobile services market in Nepal rather than to entire mobile subscriber population. The study reveals that mobile services provider must focus on improving mobile services quality to increase customer satisfaction and customer loyalty. The value of this study is that it uses well known research model to measure customer satisfaction with mobile services in Nepal.

Keywords: Customer satisfaction, Mobile services, Nepal, Customer satisfaction index, American customer satisfaction index

Paper type: Research paper

Introduction

Today, customer satisfaction (CS) has become one of the most key indicators to measure the success of firms in the business world. The idea of customer satisfaction has emerged rapidly among the business organizations more than ever before since the market is open to private sector as well as to the outside world. The objective of this study is to investigate the dominant antecedents and important consequences of customer satisfaction with the global systems for mobiles (GSM) mobile services in Nepal. The mobile services markets have become more competitive in developing countries like Nepal because of three crucial factors like de-regulation of telecom industry, increasing number of mobile services providers and the saturated market in developed countries (Turel and Serenko, 2006:315). This change of paradigm actually drives the industry’s restructuring efforts and brings the competition among telecom firms which has not seen before (Awwad, 2012:530). Given to this scenario, importance of customer oriented business strategy has also gained popularity tremendously. The penetration rate of GSM mobile services has reached to 67.92% in the mid of 2013 in Nepal (Nepal Telecom Authority, 2013). This clearly shows the degree of increasing popularity of GSM mobile services in Nepal in recent days. Table

1.1 shows Ncell has led the market with market share of 58% in GSM mobile services followed by Nepal telecom with 42% market share as per the data of July 2013.

Table 1.1: GSM Mobile Services Providers and Their Market Share

illustration not visible in this excerpt

Total 17,996,125 100%

Source: Nepal Telecommunication Authority (NTA, 2013).

There is also challenge ahead to mobile services providers to enhance customer satisfaction with the focus of customer retention. This can be achieved if mobile services providers become customer oriented. Customer orientation is about understanding customers’ needs and wants for creating better value to them continuously (Matsuo, 2006:243). It is important marketing concept which gives customer first priority to make them happy. According to Brady and Jr. (2001:248) customer orientation has a positive effect on customer perceptions which results in better performance in the services industry. Therefore, the ultimate goal of customer orientation is to satisfy the customers which further leads to success in the given competitive business scenario.

1. Theoretical Framework

1.1. American Customer Satisfaction Index Model

American Customer Satisfaction Index Model (ACSIM) is one of the most widely adopted models in researches and practices (Awwad, 2012:530). Similar studies in the past employed ACSIM as a standard model to measure customer satisfaction with mobile services in different countries. Thus, ACSIM is proposed with slightly modification as a conceptual research model to measure customer satisfaction with mobile services as depicted in figure 1.1.

ACSIM has some important features. Firstly, ACSIM is most popular and practical model (Choi, et al., 2008:320) that is consistent with well-established marketing theories and approaches (Fornell et al., 1996:8). It is because ACSIM represents the findings in past literatures and developed by researchers and experts with the knowledge in marketing field. Further, Turel and Serenko (2006:317) stated that “as of March 2006, the Thomson Corporation’s ISI Web of Science® Social Sciences Citation Index (SSCI)® listed 138 journal citations for the article that introduced the ACSIM”. Secondly, it offers both key antecedents and consequences of overall customer satisfaction which are strongly necessary to know to both researchers as well as business organization. Thirdly, ACSIM is the modern yardstick to evaluate the performance of firms, which can be used as complementary to existing performance measures like net profit margin, return on investment, profit and market shares etc. (Aydin and Ozer, 2005:487). Fourthly, ACSIM is believed to be perfect model as it measures products and services quality as experienced by customers (Choi, et al., 2008:320) and it may be employed to “various products and services, including information technologies and mobile services” (Serenko et al., 2006:21). Thus, this model measures the customer behavior and perceptions in a well defined way.

Figure 1.1: American Customer Satisfaction Index (ACSI) Model.

illustration not visible in this excerpt

Source: Fornell et al. (1996:8) and Turel and Serenko (2006:316).

1.2. Antecedents of Customer Satisfaction

Some of the well known antecedents based on the well known theory and approaches in customer behavior in the field of marketing are as follows.

Customer expectation (CE)

The customer expectation (CE) can be termed as the customers’ awareness about the quality that can be obtained from the product or service. CE is the result of consumption experience because consumption gives an idea about different qualities of product or service which might not be salient at the moment of purchase (Selnes, 1993:20). However, Fornell et al. (1996:9) argued that CE comprises customer’s forecast about the ability of supplier to offer the desired quality in the days to come in addition to customers’ reflection about previous consumption experience including non-experiential information obtained through the advertisement, colleagues’ word of mouth. Thus, CE is not only concerned about long-term relationship between customer and supplier but also critical determinant of overall customer satisfaction (Fornell et al.,1996:9)

Perceived quality (PQ)

Perceived quality (PQ) is the overall evaluation about excellence or superiority of the product, which determines quality level (Molinari et al., 2008:365). Product or service must be flexible to meet the changing needs, technologically superior, suitability for use, increase operation efficiency (Hollensen, 2011:114) to enhance customer satisfaction. More precisely, PQ is the result of recent consumption experience by customers (Fornell et al., 1996:9). Thus, PQ is concerned about fresh real experience about the product or service quality and it naturally has a direct impact on overall customer satisfaction (Fornell et al., 1996:9 Turel and Serenko, 2006:316).

Perceive value (PV)

Perceived value (PV) is the customer’s subjective evaluation of benefit received from owning or using a product relative to cost incurred to acquire it. PV can be stated as perceived benefit - perceived cost (Hult et al., 2012:15). Perceived cost is the money that the customer pays to find, acquire and use the product (Hollensen, 2011:114). It is therefore self evident that higher PV (perceived benefit > perceived cost) is better to have a positive impact on overall customer satisfaction. In general, price of product or service influences customer satisfaction. PV concept incorporates price information relative to quality of product or service and therefore “PV is the perception of quality to money” (Turel and Serenko, 2006:316). But perceived quality alone fails to address the price information to measure customer satisfaction.

The Linkage between Antecedents of Customer Satisfaction

The aforementioned three antecedents of overall customer satisfaction are assumed to be interlinked to each other. Customer expectation is expected to have a positive impact on perceived value and perceived quality (Fornell et al., 1996:9). It is because meeting customer expectation means there is high quality service available which further leads to high perceived value. Perceived quality involves “the evaluation of the service performance received and how it compared with their expectation” (Malik, 2012:69). Fornell et al. (1996:9) also stated that customer expectation accurately mirrors the quality product or service. It means expectation must be rational and reflect customers’ ability to learn from consumption experience and forecast the level of quality accordingly (Fornell et al., 1996:9).

1.3. Consequences of Customer Satisfaction

Customer satisfaction is not only affected by certain factors but also impacts on some other factors, called consequence factors. Consequence factors measure the outcomes once a customer is delighted or not (Turkyilmaz and Ozakan, 2007:673). This study deals with two consequences of customer satisfaction.

Customer Complaints (CC)

Customers express dissatisfaction if products are found to be defective or product quality is found to be below the specify standard. The expression of dissatisfaction is termed as complaint (voice). It is clear that dissatisfied customers do not happen to complain but if they complain, problem is assumed to be very serious (Homburg and Rudolph, 2001:17). Consequently, satisfied customers do not happen to complain i.e. higher the overall customer satisfaction lower is the customer complaints. Accordingly, customer satisfaction is expected to have a negative relationship with customer complaint (Fornell et al., 1996:9, Turel and Serenko, 2006:317).

Customer Loyalty (CL)

As mentioned above, another consequence of customer satisfaction is the customer loyalty. Loyal customers are the long term buyers and talk positively about product or service provider. Customer loyalty is the result of customer satisfaction and satisfied customers are expected to be loyal customers and vice-versa. Fornell et al. (1996:9) and Fornell (1992:12) stated that CL can be measured with RL and PT. Price tolerance (PT) indicates two things: likelihood of switching to competitor given that competitor deceases price or likelihood of staying with the same mobile phone provider if it increases price (Fornell et al., 1996:10; Turel and Serenko, 2006:317). If mobile subscriber continues current mobile services provider no matter what happens in either a case of PT, customer is said to be highly loyal.

The Linkage between Consequences of Customer Satisfaction

Fornell et al. (1996:9) argued that there is a positive relationship between customer complaint and customer loyalty indicating that the firm is capable to turn the complaining customers into loyal customers. It also gives information about firm’s proficiency in managing customer complaints efficiently and effectively to make customer loyal (Johnson et al. 2001:22). It makes sense for

conceptualizing the relationship between CC and CL. Based on this argument, CC should have a positive impact on CL.

Customer Loyalty and Retention

The original ACSIM uses CL as a uniform latent construct consisting of two independent latent constructs namely repurchase likelihood (RL) and price tolerance (PT). However, CL consists of two distinct latent constructs namely repurchase likelihood (RL) and price tolerance (PT) in the case of mobile services considering the effects of switching barriers in the case of mobile services (Turel and Serenko, 2006:316). RL is the hypothetical in nature as it assumes that there is no switching barrier (Turel and Serenko, 2006:316). It is not realistic to assume that subscriber is always free to choose any mobile service provider for new mobile services as in the case of RL. It is because switching barriers exist in real situation and need to be treated separately from hypothetical case of RL. The switching barriers may include all or any of the following factors:

- Technical factor;
- Economical factor; or
- Psychological factor.

Considering the GSM mobile services in Nepal, the technical barrier is negligible to change mobile service provider. It is because there is same operating system with the same mobile set and no need of learning costs while switching to another service provider.

Economical factor includes the cost such as purchase of new device and subscriber fee in the context of mobile service (Kim et al., 2004:149). There is no need of new device to change mobile service provider. There is easy access to mobile SIM card with no or low price, indicating low subscribing fee. For example, if subscriber pays, let’s say Rs100 for SIM card, balance of Rs100 is available to make call. However, availability of talk time is different. Although it seems that there is no initial subscriber fee, service charge differential exits. So there is economic factor that may create barrier to change the mobile service.

The psychological barrier may be viewed as a contractual nature of subscriber-mobile service provider relationship (Turel and Serenko, 2006:317) no matter whether it is post paid or pre-paid mobile services contract. Interpersonal/psychological relationship is built through frequent interaction between subscriber and mobile service provider and many customers also like to establish, develop and continue with current mobile service providers (Kim et al., 2004:149). The subscriber-mobile service provider relationship can be noticed when subscriber continues the same mobile service provider even though s/he knows that current mobile service quality is not good as compared to the services offered by another mobile service provider. Subscriber may also feel that there is loss in social status or performance due to cancelling existing mobile services (Kim et al., 2004:149). It means dissatisfied customers may be retained for long periods of time but they cannot be loyal customers to mobile service provider (Turel and Serenko, 2006:317). Thus, it is appealing to examine the customer loyalty provided that there is switching barrier (economical factor and psychological factor in this study). The effects of switching barriers on CL are can be measured with the price tolerance component (Turel and Serenko, 2006:317) as discussed above. Thus, RL and PT are conceptually different from each other and required to use as two distinct aspects of CL in the case of mobile services.

ACSIM is based on a reflective measurement model where manifest variables are caused by the latent constructs (Andreassen and Lindestad, 1998:16). The ACSIM as a path diagram has 15 rectangles, 7 ellipses, and two types of arrows. Rectangles represent manifest variables which are affected by latent constructs. As depicted in ACSIM, one latent construct predicts or affects other which is illustrated pointing arrows from one to other.

Each of the latent factors in ACSIM is operationalized with multiple reflective indicators. Latent factors and their corresponding reflective indicators are presented in table 1.2. Accordingly + and

- sings indicate positive and negative impact from one to other latent construct.

Table 1.2: List of Latent Factors and their Reflective Indicators

illustration not visible in this excerpt

Source: Fornell et al. 1996:10 and Turel and Serenko, 2006:323

1.4. Research Questions

To explore the aforementioned arguments, this study attempts to address two important questions through ACSIM as follows:

1. What are the most dominant antecedents of customer satisfaction with mobile services in Nepal? Consistent with the previous researches that employed ACSIM (e.g. Turel and Serenko, 2006:318) this study adopts following hypotheses:

H1: There is a positive association between customer expectation and overall customer satisfaction with mobile services.

H2: There is a positive association between perceived quality and overall customer satisfaction with mobile services.

H3: There is a positive association between perceived value and overall customer satisfaction with mobile services.

H4: There is a positive association between customer expectation and perceived quality of mobile services.

H5: There is a positive association between perceived quality and perceived value of mobile services.

H6: There is a positive association between customer expectation and perceived value of mobile services.

2. What are the key consequences of customer satisfaction with mobile services in Nepal?

Consistent with the previous researches that employed ACSIM (e.g. Turel and Serenko, 2006:318) this study adopts following hypotheses:

H7: There is a positive association between overall customer satisfaction and repurchase likelihood.

H8: There is a positive association between overall customer satisfaction and price tolerance.

H9: There is a negative association between overall customer satisfaction and customer complaint. H10: There is a positive association between customer complaints and repurchase likelihood. H11: There is a positive association between customer complaints and price tolerance.

2. Research Methodology

Sampling Design and Data Collection

A general rule of thumb is that the sample size above 200 is believed to “provide sufficient statistical power for data analysis” in structural equation modeling (Hoe, 2008:77; Lei and Wu, 2007:34). Thus, this study uses 250 randomly chosen undergraduate and graduate students as a sample from two colleges affiliated with the two universities in Nepal (Pokhara University and Purbanchal universities).

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Details

Seiten
33
Jahr
2014
ISBN (eBook)
9783668208339
ISBN (Buch)
9783668208346
Dateigröße
1.3 MB
Sprache
Englisch
Katalognummer
v317801
Institution / Hochschule
Maastricht School of Management
Note
B
Schlagworte
american customer satisfaction index model acsim nepalese mobile phone sector

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Titel: An application of the American Customer Satisfaction Index Model (ACSIM) in the Nepalese Mobile Phone Sector