International Journal of Innovation, Creativity and Change. www.ijicc.

net
Volume 6, Issue 4, 2019

Customer Satisfaction towards Online

Shopping in Klang Valley
*Sarita Ibrahima, Md. Emon Raihanb, Roslan Mohd Rosec, Yanti Lumatd,
Noor Lees Ismaile, a,b,c,d,eFaculty of Business and Technology, UNITAR
International University,
*Corresponding Author Email: [email protected]

According to Internet Word Statistics (2012) about 60.7% of the total

population in Malaysia uses the Internet and more than 11 million
people are young and adults. This study aims to examine factors that
influence customer satisfaction in an online purchase context. A total of
200 responses were collected throughout the Klang Valley.
Questionnaire survey method was used to gather data from the
respondents. Data were analyzed using descriptive analysis. In addition,
regression analysis was performed to test the hypotheses. Findings show
that only Reliability and Quality have effects on Customer Satisfaction.

Key words: Online shopping, Reliability, Security, Quality, Customer Satisfaction.

Introduction

Internet and information technology have made tremendous contributions for business
transformation worldwide. This has given birth to E commerce which encompasses several pre
purchase and post purchase activities leading to exchange of products or service or information
over electronic systems such as the internet and the other telecommunications networks based
on (Garrett and Parrott, 2005; Dholakia and Uusitalo, 2012). According to Stafford, et.al
(2004), online shopping provides more flexibility and opportunity. As an example consumers
can shop with increased knowledge of products through online research and place less reliance
on salespersons. Therefore, if the consumers wish to make a purchase, consumers are not
restricted by time, distance, or location based on (Kim and Kim 2004); (Dholakia and Uusitalo,
2012).

As a result, they are able to choose the lowest available priced item. Online shopping was
introduced as a medium for transactions between consumers and firms. Internet shopping is
changing and the methods that customers are now using to buy goods and services have quickly
developed into a global fact and phenomenon. There is difference among the numbers of
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customers who visit a website and the number of real purchases being made. This is evident
because of the increase in retailers now offering online store interfaces for consumers. With
the growth of online shopping, comes, the concepts of satisfaction and loyalty for website are
involved in providing services on the website and transacting online.

Objective of this study

The increase in online purchasing raised a question about how satisfied customers are when
they purchase online. Specifically, the objective of this study is to investigate whether
reliability, security and quality of the website will affect customer satisfaction towards online
purchase among youth in Malaysia.

Importance of the study

This research was conducted on study factors that affect customer satisfaction of online
purchase in Malaysia. This study enables us to gather the views of online customers in Malaysia
with respect to their expectation and satisfaction. Based on the practitioner perspective this
research will help the online sellers to identify the key improvement areas in their online
business so as to increase customer satisfaction.

Research Questions

This study focuses on the factors that affect customer satisfaction towards online purchase.
Based on the variables that influence online purchase, the following research questions are
derived.
i) What is the relationship between reliability and customer satisfaction towards online
shopping in Malaysian's perspective?
ii) What is the relationship between security and customer satisfaction towards online
shopping?
iii) What is the relationship between quality (website and product) and customer
satisfaction towards online shopping?

Research Problem

The desired outcome of this study is customer satisfaction. In online shopping, there are
instances when companies accept orders for out of stock items. Customers will be dissatisfied
if they find out the orders cannot be fulfilled (Carroll & Broadhead, 2001). Customers will also
be dissatisfied if their personal information is being used in an unauthorized manner.
Customers are concerned about internet security when they give their credit card details. In
addition, unwanted emails and newsletter will certainly irritate the customers. The other
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problem in terms of quality occur where the website is unable to deliver information that the
customer sought after. Poor quality product and not on time delivery will also affect customer
satisfaction.

Literature Review

Several studies have been conducted in order to identify the customer satisfaction towards
online purchase and these forecast whether an individual will purchase their desired product or
services via online or not. One of the basic challenges and concerns of online product
purchasing is the way to attract and grab the consumer’s attention to motivate them in shifting
from the traditional way to prepare their product and services through internet channels instead
traditional channels.

Independent Variables
Reliability

Ho and Wu’s (1999) study confirmed homepage presentation and reliability are the important
factors that have most influential effect on online purchase. It can be argued that online
shoppers wish to receive the right quality and quantity of items that they ordered within the
stipulated time offered by the online purchaser. Consumers also expected to be billed properly
(Jun et.al.2004; Satya & Kuraesin 2016). Time and cost saving are the main advantages of
online shopping. According to (Devaraj et.al, 2002) time efficiency and store efficiency are
reflected in time cost and price savings respectively. Moreover based on Lee and Joshi (2007);
Ahn et.al (2004); Ho (2004); Grewal et.al (2004) and Shih (2004) studies found that delivery
performance has influence on customer satisfaction.

In addition, convenience is the most important effect on reliability of consumer’s satisfaction

with Internet usage and is related to speed, easy access to information at low cost such as time,
effort and displacement where everything can be found in a minute without time or
geographical restraints. In terms of customer satisfaction, online shopping convenience is
related to an easy way of shopping and reducing total time spent on purchase by (Szymanski
& Hise 2000; Kim & Lim 2001). Jarvenpaa & Todd (1997 and Alba et.al, (1997) explain that
online shopping is a pleasant way of shopping and saving through delivery time.

Security

Based on Burke, R.R. (2002), trust is a key factor that determines the success of online purchase
transactions. Basically Burke’s research focused on available security measures which assure
online shoppers safety and great sales promotions and online deals which stimulate customers
to shop online. According to Ranganathan & Ganapathy (2002) and Salisbury et al. (1998)
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security also influences the online purchase. Many consumers are still reluctant to release
payment card information during online purchase, fearing a loss of control over their accounts.
They mentioned that in order to alleviate customer fears many online purchase offers alternate
forms of payment such as telephone ordering or accounts with ID’s and passwords. Belanger
et.al (2002) found that the presence of security features on an e-commerce site was important
to consumers, and the way consumers security concerns may be addressed by similar
technology protections as those of the business, such as encryption and authentication.

Quality

Quality needs to be defined in terms of parameters or characteristics, which vary from product
to product. As an example, for a product that is purchased online, there are influences of
reliability, design, material and color. Therefore, quality is a difficult factor to isolate and
define when examining online item for purchase. While the term quality generally denotes high
quality, lower levels of quality will often satisfy specific clientele, depending on expectations
and performance needs of online shopper. In some products, quality may be equated with
durability and for others it may suggest a fit with a certain lifestyle (Riesz 1978).

Online purchase context quality is considered a service quality that includes the approach from
how the service provider, for example a website, serve their customers, how the product they
offer satisfies customer needs (as in physical quality of product) and how such particular
products apparently communicate that brand image to the online shopper (Bitner 1992);
(Booms and Bitner 1982). Quality is regarded as a key strategic component of competitive
advantage and therefore the enhancement of product or service quality has been a main matter
of concern for firms (Daniel, et.al 1995).

Dependent Variable
Customer Satisfaction

Customer satisfaction is the ultimate result of meeting a consumer’s expectation from the
performance of products (Schott, 2017; Asnawi et al., 2019). Most satisfied customers
normally have the intention to re-purchase the products if product performance meets his or
her expectation. Like traditional shopping, online shopping also needs to satisfy their
customers. Customer satisfaction is one of the central constructs in the study of consumer
behavior both in traditional and online shopping. Customers must be satisfied with the e-
commerce shopping experience before acquiring more goods and services online. A great deal
of studies has been conducted to identify the antecedents of customer satisfaction towards
online shopping by (Jun et.al 2004). Limayen et.al (2000) found that customer’s attitudes and
beliefs regarding convenience and security concerns have significant effects on their intention
to purchase online. Shankar et.al (2003) also contended that service provided during and
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following the purchase is essential to e-consumers repeat purchases. Christian and France
(2005) had identified three categories of determinants that could affect customer satisfaction
towards online shopping. These are technology, shopping and product factors.

Relationships among variables

Relationship with reliability

In the study conducted by (Liu et.al 2008) it was argued that information quality, website
design, merchandise attributes, transaction capability, security or privacy, payment, delivery
and customer service are strong predictors of customer satisfaction in the online shopping
environment. The merchandise attribute was evaluated from the dimensions such as product
variety and product price. Furthermore, the quantity and quality of the product plays a
significant role in whether customers are satisfied or dissatisfied with their online shopping
experience. It is indicated that reliability will have positive effects on customer satisfaction in
the online shopping. Thus leading to the development of H1 -

H1 There is a significant relationship between reliability and customer satisfaction

Relationship with security

The relationship of security plays a role in creating satisfied and expected outcomes in online
transactions by (Pavlou et.al 2003; Seddighi & Yoon 2018). Egger (2006) argued that sufficient
trust needs to exist when placing an order online and when the customer submit his or her
financial information and other personal data in undertaking financial transactions. Jarvenpaa
and Tractinsky (1999) concluded that the higher the degrees of customers trust the higher
degree of customer online purchase. Kim and Shim (2002) emphasized that the personal
awareness of security has the significant influence on customer satisfaction. This leads to the
formulation of H2
H2 There is a significant relationship between security and customer satisfaction

Relationship with quality

Gehrt et.al (2007) discovered that customers from the shopping enjoyment segment are
positively inclined toward recreation, quality and impulse orientations when making online
purchase. This support the development of H3.

H3 There is a significant relationship between quality and customer satisfaction

Theoretical framework

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Figure 1 shows the framework which was adopted from Sekaran (2000). Sekaran in her study
proposed reliability, security and quality as the independent variables for customer satisfaction.
Dholakia and Uusitalo (2012) mentioned that reliability, security and quality are directly
proportional to customer satisfaction, meaning to say that if any one variables from these three
variables did not fulfil its requirement, there will be some asymptote in the customers’ level of
satisfaction.

Customer satisfaction should be measured and translated into number of measurable parameter.
Customer satisfaction measurement may be considered as the most reliable feedback, providing
client’ preferences and experiences in an effective, direct, meaningful and objective way.
According to Gerson (2013), customer satisfaction may be considered as a base line standard
of performance and a possible standard of excellence for any business organization.

Figure 1. Theoretical Framework

Independent
Variables Dependent Variable

RELIABILITY H1

H2 CUSTOMER
QUALITY SATISFACTIO
N
H3

SERVICE
Research Methodology

A survey was randomly administered in three different areas in Klang Valley. They survey
question was distributed to online shoppers in these area. The survey was not conducted online
to better target the offline shoppers. 210 surveys were used for the purpose of data analysis.
Ten surveys had to be discarded since they were incomplete or instructions had not been
followed. The survey consisted of components such as Demographics, Reliability, Security,
Quality and Customer Satisfaction, and Perception.

Sampling

This study uses convenience sampling and distributed the questionnaire to the online shoppers
within Klang Valley. The population selected for the study are from mainly private universities
in Sunway, Selangor and also working adults from private companies. Questionnaires were
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distributed by hand to the respondents who have previous online shopping experience and
enough time was given to respondents to fill in the questionnaire to reduce sampling error.

Findings and Discussions

A total of 210 questionnaire were distributed randomly. Only 10 questionnaire were discarded,
which make 80% of total questionnaire distributed were satisfactory completed. These
questionnaire were tested using SPSS and subsequently run for reliability test and regression
analysis.

Descriptive Analysis
Demographic

The results show that 55.5% of the respondents are male while the remaining 44.5% are female.
The majority of the respondents 71 were aged between 23-26 years old (35.5%) and 51% of
the respondents are international citizens. Fifty three (26.5%) respondents are tertiary students,
twenty five (12.5%) are from private sector, fifty six (28%) respondents came from government
sector and the remaining sixty-six (33%) are self-employed. Ninety-two (46%) of the
purchasers have an income range between RM1,001 to RM2,000 and sixty-seven (33.5%)
make online purchase through access internet several times in a week.

Table 1: Reasons for preference for online purchase

Number of respondent Percentage Reasons prefer online purchase
60 30 Convenient
59 29.5 Can buy things whenever they want
40 20 Time saving
26 13 Cost saving
15 7.5 Not having to wait in a line

Table 1 shows that more than 50 percent of the respondents preferred to do online purchase
due to its convenience for them to buy things as and when they want. Majority of the
respondents (46%) buy tickets online as compared to buying clothes, electronic items, health
products and books and only one respondent purchase collectibles and art online.

Analysis of Reliability Factor

Questionnaire responses were rated using a 5 point Likert scale ranging from Least Satisfied
(1), Not Satisfied (2), Satisfied (3), Very Satisfied (4) and Extremely Satisfied (5).

Table 2: Mean score for Reliability.

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Item Reliability Standard

Mean
deviation
R1 Loyal to online shopping 3.09 1.011
R2 Willingness to do online shopping 3.37 1.107
R3 The goods is delivered on time as promised by the
2.73 1.075
company
R4 Online shopping able to perform the promised service
3.14 0.882
accurately
R5 I am satisfied with the delivery mode of the online
3.21 1.084
shopping
R6 The items sent by the online seller are packed properly
3.38 1.112
and perfectly sound
R7 The products on the purchase in delivered fast 3.36 1.115
R8 Low price 3.27 1.113
R9 It is easy to choose and make comparison with other
3.30 1.114
products.

Referring to Table 2, with a mean score of 3.38 majority of the respondents are satisfied that
“The items sent by the online seller are packed properly and perfectly sound”. Under the
category of R3, with a mean score of 2.73 majority of the respondents are less satisfied that
“The goods are delivered on time as promised by the Company”.

Analysis of Security Factor

Table 3: Mean score for security

Item Security Standard
Mean
deviation
S1 An online shopping gives trust on using the website 3.26 0.783
S2 Online shopping should provide an adequate payment
3.36 0.85
options
S3 Online shopping should provide contact number 3.28 0.828
S4 Online shopping use sufficient security mechanism to
3.37 0.785
ensure privacy
S5 Online shopping ask customer’s permission to send
3.12 0.914
advertisement
S6 Online shopping offer guarantee for their products 3.31 0.876
S7 Online shopping can be trusted 3.16 0.771
S8 Credit card’s information is secured 2.96 0.95
S9 Online shopping provides accurate information 3.28 0.875

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S10 The website is safe in doing transactions 3.27 0.742

Referring to Table 3, with a mean score of 3.37 majority of the respondents are satisfied that
“Online shopping should provide contact number” and at the other end with a mean score of
2.96 majority of the respondents are less satisfied that “Credit card’s information is secured”.

Analysis of Quality Factor

Table 4: Mean score for Quality

Item Quality Standard
Mean
deviation
Q1 The products of the website meet my needs and
3.22 0.879
expectations
Q2 Customer service personnel are always willing to help 3.14 0.923
Q3 Online shopping would provide me with information 24
3.34 1.076
hours
Q4 Quality of information provided is reliable 3.3 0.901
Q5 I am satisfied with the product quality 3.33 0.951
Q6 The company is ready and willing to respond to customer
3.39 0.895
needs
Q7 Willing to respond 3.1 1.037
Q8 Online shopping allows me obtain information on product
3.37 0.887
easily
Q9 Online purchase provides accurate information 3.64 0.967
Q10 The online purchase having difficulty in returning
3.15 0.996
products

Table 4 shows that the majority with the highest mean score is statement no Q9 (3.64) with the
standard deviation of 0.996 while the lowest mean score is statement no Q7 (3.1) with standard
deviation of 1.037.

Table 4 shows that with a mean score of 3.64 majority of the respondents are satisfied that
“Online purchase provides accurate information”, and with a mean score of 3.1 the majority of
the respondents are also satisfied that “The company is ready and willing to respond to
customer needs’’.

Analysis of Customer Satisfaction Factor

Table 5: Mean score for Customer Satisfaction

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No Customer satisfaction Standard

Mean
deviation
C1 I have truly enjoyed purchasing from online 3.27 1.039
C2 I am satisfied with my most recent decision to purchase
3.41 0.875
from online
C3 I am willing to use my credit card to purchase from online 3.3 0.935
C4 Online shopping would provide me with a timely response
3.47 0.907
to request
C5 My choice to purchase from the online was a wise one 3.37 0.835
C6 I am satisfied with my decision to buy online goods 3.55 0.918
C7 In case of inconvenience do you use help service 3.45 0.889
C8 Online shopping would provide me with returns policy 3.29 0.926
C9 On a scale from 1 to 5 , how often you are going to shop
3.47 0.935
online in near future
C10 Overall, how would you rate your satisfaction with online
3.24 0.828
shopping

Table 5 Based on Table 4. 14 above, the highest mean score is statement no C4 (3.47) with the
standard deviation of 0.907 and C9 (3.47) with standard deviation of 0.828.

Based on Table 5, with a mean score of 3.47 majority of the respondents are satisfied that
“Online shopping would provide me with a timely response to request and the decision to buy
product on online in near future. Whereas with a mean score of 3.47, the majority of the
respondents are also satisfied that ‘’Overall, the respondents are satisfied with online
shopping’’.

Pearson correlation

Table 6 shows a strong significant level of 0.000 among the variables making significant unique
contribution to the predication of the dependent variable (Palant, 2000).

Table 6: Correlation analysis

Independent Variables Dependent variable
Sig. (2 tailed)
Customer Satisfaction
Reliability 0.372
0.000
Security 0.543
0.000

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Quality 0.623
0.000

Hypotheses testing using regression analysis

Table 7 shows the summary of regression analysis. A linear regression were used to test and
determine whether there is a positive relationship between the Reliability, Security and Quality
(Independent Variables) and Customer Satisfaction (Dependent Variables).

Table 7: Summary of regression analysis

Model summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .496a .246 .242 .38623
2 .241a .058 .053 .43166
3 .381a .145 .140 .41123

Coefficientsa
Model Standardized
Unstandardized Coefficients Coefficients
B Std. Error Beta t Sig
1 (Constant) 1.683 .200 8.419 .000
Reliability .336 .057 .402 5.949 .000
Security .030 .043 .047 0.692 .490
a
Quality .161 .055 .205 2.926 .004
a. Dependent Variable: Customer Satisfaction

As shown in Table 7, the value of R. Square is 25% for reliability, 5.8% for security and 15%
for the quality. This is supported by Beta (B) values of 34%, 3% and 16% respectively. The
result shows a strong significant level of 0.000 which indicate that reliability and quality
contributes to customer satisfaction in online shopping. However, for security, the significant
value is 0.490 which is more than 0.05 do not contribute to prediction of Customer Satisfaction.

Summary of findings

Table 8 shows the result of the hypotheses testing where H1 and H3 are accepted and H2 is
rejected

Table 8: Result of hypotheses testing

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There is a significant relationship between Reliability and

H1 Accepted
Customer Satisfaction towards online shopping
There is a significant relationship between Security and Customer
H2 Rejected
Satisfaction towards online shopping
There is a significant relationship between Quality and Customer
H3 Accepted
Satisfaction towards online shopping

Conclusion

Hypothesis 1 examines the relationship between reliability and customer satisfaction towards
online purchase. Questions such as if they are satisfy with the service that the online shopper
provides to their purchaser. Parasuraman et.al,’s (2005) study is on online service quality
towards online purchase. The administration nature of the web service quality is particularly
essential for the interface between online purchases and Web. Kateranttanakul (2002) argued
that reliability of website information facilitated consumers to gain lower risks, better judgment
for their decisions and security in reaching the flawless decisions, and in turn affects customer
satisfaction and willingness to purchase online. If the customer finds the reliability factors
helpful, they may continue using the online purchase, whereas if they think the factors makes
no difference compared to traditions stores, than they may prefer the conventional store
purchased.

Hypothesis 2 examines the relationship between security and customer satisfaction towards
online purchase. Consumers concern about the security, liability and privacy of the online
website (Gefen, 2002). In addition, the main critical factors that influence security is the trust
because the online purchase need to trust the online business before doing and purchasing a
transaction. It was pointed out that the lack of online consumer trust was the main barrier of
consumer participation in e-commerce and has been found to be one of the major obstacles to
the popularity of internet transactions. Therefore based on previous study, Christian and France
(2005), this study reconfirmed that there is a unique and significant relationship between
security and customer satisfaction.

Hypothesis 3 examines the relationship between quality and customer satisfaction towards
online purchase. According to Jarvenpaa & Todd (1996), quality is an intrinsic property of a
product. Product quality is expected standard of product or service excellence. Some
consumers regard quality as their first consideration when shop online. Although online
shopping cannot enable consumers to touch or feel directly the quality of the product, but
comments on the website can indicate the quality of the product to some extent. Therefore,
(Christian and France, 2005) enhancing product quality will have a positive effect in improving
consumer satisfaction.

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Limitations of the study

The present data are mostly exploratory in nature and it is inappropriate to arrive at assumptions
from a solitary study. One issue is the utilization of subjects who may not be illustrative of the
internet shopping community. While the shops on the web, an immense subject base, may be
more fitting. Another limitation is the utilization of a paper based full-profile strategy conjoint
analysis. A versatile conjoint analysis that could be administered by means of the web offices
could give more propriety, empowering addition of more levels to every viewpoint at first and
after that the selection of a noteworthy scoring level for the final analysis.

Recommendation for further study

Future work should be possible utilizing adaptable aggregate examination controlled by means
of the Web with more levels to every viewpoint. The most noteworthy scoring levels for the
last examination in light of the information could then be chosen. Incorporation of classes of
variables and more characteristics was introduce investigation of classes of components not
regularly found in the writing in this field, for example, social impact elements. It would
likewise be interesting to conduct a period arrangement study to research how shopper
inclinations change over time.

This study strengthens results from previous research where reliability and quality were found
to be important criteria in determining customer satisfaction in an online purchase and which
are supported with the research findings whereby H1 and H3 are accepted and H2 is rejected.

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