Measuring customer satisfaction using retail internet banking service a sacombank

TRNG I HC M TP.HCM UNIVERSITÉ LIBRE DE BUXELLES HO CHI MINH CITY OPEN UNIVERSITY SOLVAY BRUSSELS SCHOOL MBAVB3 NGUYEN THI HUYEN ANH MEASURING CUSTOMER SATISFACTION USING RETAIL INTERNET BANKING SERVICE AT SACOMBANK MASTER PROJECT MASTER IN BUSINESS ADMINISTRATION (PART TIME) Tutor’s name: Dr. NGUYEN KIM THU Ho Chi Minh City (2010) DECLARATION I declare that this final project contains no material that has been submitted to any other program in other institutes, colleges and universities. This work was done by author except where due reference is made in the text. Signature: NGUYEN THI HUYEN ANH _____________________ Date:__________________________________________________ ACKNOWLEDGEMENTS First of all, I would like to acknowledge all professors and coordinators who provided me valuable knowledge and support at Solvay Business School and Ho Chi Minh City Open University. I would like to acknowledge my tutor, Dr Nguyen Kim Thu, for her assistance on my research. I would like to express my huge thanks to my parents and my sisters who support me and encourage me to complete this research. I would like to acknowledge Ms. Nguyen Thi Thuy Trang and Ms. Nguyen Thi Tra My, Sacombank members, who help me to collect relevant information and database. I would like to thank my VB3 friends, who have been studying and sharing ideas together for the whole course. In particular, I wish to acknowledge the support of the following people who without their assistance, this project would not finish. Ms. Duong Thi Kieu Chinh and Mr. Dang Tran Hanh Thong for their encouragement and support, Ms. Phan Xuan Binh for her great assistance, her value feedbacks help me to find out the way to complete the research. Thank you so much for your kind assistance. And, I would like to send my thanks to all respondents. ABSTRACT The Internet has revolutionized the way that businesses operate and the financial world has not been spared (Hoffman et al. & Bateson et al., 2006). With the appearance of internet, bank has no longer boundary to time or geography. Customers can catch their banking account operations 24/7 via internet. In Vietnam, internet banking is still at the beginning stage. To recognize that Vietnam is potential market for internet banking (IB) with high internet users in Asia, Vietnamese bankers have launched this service to the market. But in order to success in banking services, bankers should understand how satisfied their customers feel about their services. Kotler said that customer satisfaction is associated with numerous positive business outcomes (1994). Until now, many researches had been conducted to find out the reaching of customer satisfaction for banks. But fewer researches have addressed the measuring customer satisfaction in IB service. Hence, this empirical study aims to measuring customer satisfaction from retail IB service and Sacombank’s IB customers were chosen as the population. The objectives of this project are (1) to measure the relative customer satisfaction with retail IB service at Sacombank, (2) to identify the drivers of customer satisfaction with retail IB service at Sacombank, (3) to find out which are the most significant important in service and internet attributes impacting on customer satisfaction and (4) to contribute recommendations to improve customer satisfaction. TABLE OF CONTENTS CHAPTER 1 INTRODUCTION 1.1. INTRODUCTION 1 1.2. RESEARCH BACKGROUND 2 1.3. RESEARCH PROBLEM 6 1.3.1. RESEARCH OBJECTIVES 11 1.3.2. RESEARCH QUESTIONS 11 1.3.3. RESEACH MODEL 11 1.3.4. RESEARCH HYPOTHESIS 13 1.4. METHOD OF STUDY 13 1.5. SCOPE AND LIMITATION OF STUDY 14 1.6. FRAME WORK OF STUDY 15 CHAPTER 2 LITERATURE REVIEW 2.1. INTRODUCTION 17 2.2. INTERNET BANKING 17 2.3. SERVICE QUALITY AND INTERNET QUALITY 18 2.3.1. SERVICE QUALITY 18 2.3.2. INTERNET QUALITY (WEBSITE QUALITY) 21 2.4. CUSTOMER SATISFACTION 22 2.5. THEORETICAL FRAME WORK 23 2.5.1. MEASUREMENT OF SERVICE QUALITY 23 2.5.2. MEASUREMENT OF INTERNET QUALITY 25 CHAPTER 3 RESEARCH METHODOLOGY 3.1. INTRODUCTION 27 3.2. DESCRIPTION OF RESEARCH METHOD 28 3.2.1. QUALITATIVE RESEARCH 28 3.2.2. QUANTITATIVE RESEACH 30 3.2.3. MEASUREMENT OF VARIABLES 32 3.2.4. DATA COLLECTION 36 3.2.5. MEASUREMENT OF INSTRUMENTS 37 CHAPTER 4 FINDING ANALYSIS 4.1. INTRODUCTION 40 4.2. BRIEF INFORMATION ABOUT IB SERVICE AT SACOMBANK 40 4.3. DESCRIPTIVE FINDINGS OF THE RESEARCH 42 4.3.1. DESCRIPTIVE GENERAL INFOMATION 42 4.3.2. IB SERVICE 43 4.4. RELIABILITY ANALYSIS 45 4.5. FACTOR ANALYSIS 46 4.6. REGRESSION ANALYSYS 50 4.6.1. CORRELATION ANALYSYS AND FINDING 50 4.6.2. EVALUATING AUTHOR’S MODEL 51 CHAPTER 5 CONCLUSION & RECOMMENDATIONS 5.1. INTRODUCTION 56 5.2. RESEARCH SUMARY 56 5.2.1. SUMMARY RELATED TO RESEACH QUESTIONS 57 5.2.2. SUMMARY RELATED TO HYPOTHESES 58 5.3. RECOMMENDATIONS 59 5.4. IMPLICATIONS FOR FURTHER RESEARCH 61 GLOSSARY OF TERMS AND ABBREVIATIONS ACB Asia Commercial Bank IB Internet bank Sacombank Sai Gon Thuong Tin Commercial Joints Stock Bank VCB Vietnam Bank for Foreign Trade LIST OF TABLES Table 1.1: Vietnamese Internet users 4 Table 3.1: Number of IB customers on HCMC area 33 Table 3.2: Numbers of chosen customers in HCMC 34 Table 3.3 Coding variables 36 Table 4.1: Cronbach Alpha value of each factor 45 Table 4.2: Corrected Item-Total Correlation 46 Table 4.3: Correlation matrix 47 Table 4.4: KMO & Bartlett’s Test of Sphericity summary 49 Table 4.5: Pearson correlation (r) 51 Table 4.6: Model summary 52 Table 4.7: Anova (b) 52 Table 4.8: Coefficients (a) 53 Table 4.9: Hypothesis Assessment result 54 LIST OF FIGURES Figure 1.1: Internet Penetration in Asia in 2009 (% of population) 4 Figure 1.2: IB’s users at Sacombank 10 Figure 1.3: Relationship of loyalty and satisfaction 10 Figure 1.4: Author’s research model 12 Figure 2.1: Factors impact on customer satisfaction 23 Figure 3.1: Research process of the study 28 Figure 4.1: Charter Capital in recent years 41 Figure 4.2: Total Asset in recent years 41 [...]... 1995) Hokanson’s (1995) proposed that some factor impact on customer satisfaction: Figure 2.1: Factors impact on customer satisfaction Source: UCTI W orking Paper 2.5 THEORICAL FRAMWORK 2.5.1 MEASUREMENT OF SERVICE QUALITY Many studies have used service quality as a factor impact on customer satisfaction (Parasuraman et al., 1988) Parasuraman (1985) proposed ten service attributes, after that in 1988,... dimension From measuring customer satisfaction, Sacombank would improves its’ customer satisfaction by suitable approaches And it could get customer retention because satisfied customers are more loyal than unsatisfied customers (figure 1.3) 10 Figure 1.2: IB’s users at Sacombank Source: Internal source of Sacombank Figure 1.3: Relationship of loyalty and satisfaction Source: James L.Heskett.W Earl Sasser,... also established international operations in Laos and Cambodia Sacombank s brand name and reputation has been recognized by Vietnam community through prestigious awards as “Yearly Retail Banking in Vietnam 2007, 2008” be voted by Asian Banking and Finance, “The best local Bank in Vietnam 2008” be voted by The Asset, Global Finance and Finance, “The best foreign exchange business bank in Vietnam 2009”... schools, anywhere and anytime Sacombank s internet banking, is definite as a one of e -banking channel which is provided by Sacombank to customers via Internet with the main purpose is to apply payment and transfer subsystem facilities to supplied internet channel products/services and other fundamental services such as enquiry, information registration etc; customers enable to access to Sacombank s website... provide customers products and service information and related information Many researchers also assessed website quality via dimensions developed by Parasuman as above section (La et al, 2005) 22 2.4 CUSTOMER SATISFATION Explanation about customer satisfaction with a purchase depends upon the product’s performance relative to a buyer’s expectations; a customer might experience various degrees of satisfaction. .. Vietnam was still infancy at the beginning stage According to a study of Stegman (1999), to implement one banking- transaction by traditional channel costs average 1.07 USD in USA After applying internet banking, the cost was 0.04 USD for call center; 0.27 USD for ATM; 0.01 USD for Internet banking It is obvious that offering IB, banks have a clearly cost advantage compared to traditional transaction... realize these benefits, bankers invest billions of dollars in providing and improving the IB system for their customers (Bauer, Hammerschmidt and Falk, 2005) In Pacific Asia, IB was launch in China, 3 HongKong, Singapore, Thailand, Malaysia etc In Malaysia and China, IB was official allowed by Centre Bank in 2000 Maybank is the first bank in Malaysia to offer IB However, Thailand and Singapore were applied... money Bank is an intermediated financial institution and plays a key drive in any national economy and global economy as well In scenario of competition, each bank has tried to serve their customers more than their expected value Internet has brought the new entrants for banking to change the structure of banks (Laura & Kate, 2003) in general and banking service in particular The wide application of internet. .. transferring money transactions, unprofessional consultant staffs, busy contact center, inconsistency instruction between consultant staff at branch and contact center and (2) internet qualification such as difficult in logging in account, embarrass interface etc The project aims to measure the customer satisfaction from using retail IB by examining customer satisfaction via service and internet quality dimension... website via login information to conduct transactions on their own accounts (Sacombank, 2010) Acar et al., Nadi et al., and Huseyin C have examined IB websites and IB products and services (2010) Minjoon J and Shaohan C (2001) investigated the determinant of IB service quality via three categories which are internet quality, service quality and diverse product This project aims to exam customer satisfaction . from using retail IB by examining customer satisfaction via service and internet quality dimension. From measuring customer satisfaction, Sacombank would improves its’ customer satisfaction. Pacific Asia, IB was launch in China, 3 HongKong, Singapore, Thailand, Malaysia etc. In Malaysia and China, IB was official allowed by Centre Bank in 2000. Maybank is the first bank. SOLVAY BRUSSELS SCHOOL MBAVB3 NGUYEN THI HUYEN ANH MEASURING CUSTOMER SATISFACTION USING RETAIL INTERNET BANKING SERVICE AT SACOMBANK MASTER PROJECT MASTER IN BUSINESS ADMINISTRATION