Factors affecting customer loyalty in mobile communication services in ha noi, viet nam

FACTORS AFFECTING CUSTOMER LOYALTY IN MOBILE COMMUNICATION SERVICES IN HANOI, VIETNAM _ A DISSERTATION Presented to the Faculty of the Graduate School Southern Luzon State University, Lucban, Quezon, Philippines in Collaboration with Thai Nguyen University, Socialist Republic of Vietnam _ In Partial Fulfillment of the Requirements for the Degree Doctor of Business Administration _ By NGO ANH CUONG (SMILE) December 2013 i APPROVAL SHEET The Dissertation of NGO ANH CUONG entitled FACTORS AFFECTING CUSTOMER LOYALTY IN MOBILE COMMUNICATION SERVICES IN HANOI, VIETNAM Submitted in Partial Fulfilment of the Requirements for the Degree DOCTOR OF BUSINESS ADMINISTRATION A program offered by Southern Luzon State University, Republic of the Philippines in collaboration with Thai Nguyen University, Socialist Republic of Vietnam has been approved by Oral Examination Committee MELCHOR MELO O PLACINO, PhD Expert CONRADO L ABRAHAM, PhD Expert JOANNA PAULA A ELLAGA, DBA Expert EDWIN P BERNAL, DBA External Panel CECILIA N GASCON, PhD Chairman Endorsed by: Recommended by: NELLY I MENDOZA, DBA Adviser APOLONIA A ESPINOSA, PhD Dean Accepted in Partial Fulfilment of the Requirements for the Degree Doctor of Business Administration _ Date WALBERTO A MACARAAN, EdD Vice President for Academic Affairs ii CERTIFICATE OF ORIGINALITY This is to certify that the research work / dissertation entitled “Factors affecting customer loyalty in mobile communication services in Hanoi, Vietnam”, orally defended/ presented under the DBA Program jointly offered by Southern Luzon State University of the Republic of the Philippines and Thai Nguyen University of the Socialist Republic of Vietnam, embodies the result of original and scholarly work carried out by the undersigned This dissertation does not contain words or ideas taken from published sources or written works by other persons which have been accepted as basis for the award of any degree from other higher education institutions, except where proper referencing and acknowledgement were made Researcher/Candidate:Ngo AnhCuong (Smile) Date Orally Defended: October 10, 2013 iii ACKNOWLEDGMENT Iwould liketo express ourmost sincere thankstothe Management Board ofthe SouthernLuzonState University, Thai Nguyen University; teachers of theschoolhavehelped mefacilitatethe learning processthroughout Iwould like to myenthusiasticteacher expresssinceregratitude to Dr whohasdedicatedguidance, Nelly Mendoza, encouragement, timeandhas shared knowledgefor meduringthis research I also would like to thank Dr Joanna Paula Ellaga who has insightful suggestion for my dissertation IsincerelythanktheBoard of theUniversityofLaborandSocial Affair (ULSA), colleaguesinULSA, classmates in DBA1 who enthusiastically facilitated,helped andsharedexperienceto helpcomplete the dissertation Finally, Iwould like to thank my best friends who have encouraged to complete mydissertation Ngo AnhCuong iv DEDICATION To My Family and Friends this piece of work is for you… NAC v TABLE OF CONTENTS PAGE TITLE PAGE ……………………………………………………………… i APPROVAL SHEET ……………………………………………………… ii CERTIFICATE OF ORIGINALITY ……………………………………… iii ACKNOWLEDGEMENT ………………………………………………… iv DEDICATION ……………………………………………………………… v TABLE OF CONTENTS ………………………………………………… vi LIST OF TABLES ………………………………………………………… viii LIST OF FIGURES ……………………………………………………… x ABBREVIATIONS ………………………………………………………… xi LIST OF APPENDICES ………………………………………………… xii ABSTRACT ………………………………………………………………… xiii CHAPTER I II III INTRODUCTION …………………………………………… Background of the Study ………………………………… Statement of the Problem ………………………………… Objectives of the Study …………………………………… Hypotheses of the Study …………………… …………… Significance of the Study ………………………………… Scope and Limitations of the Study ……………………… Definition of Terms ………………………………………… REVIEW OF LITERATURE ……………………………… 11 Conceptual Framework ………………………………….… 39 METHODOLOGY Locale of the Study ………………………………………… 41 Research Design …………………………………………… 41 Determination of Sample Size …………………………… 43 Sampling Design and Techniques ……………………… 43 Research Instrument ……………………………………… 44 vi IV V Data Gathering Procedure ………………………………… 51 Data Processing Method ……….………………………… 51 Statistical Treatment ……………………… …….…… 51 RESULTS AND DISCUSSIONS ………………………… 54 4.1 Respondent’s Profile ………………………………… 54 4.2 Preliminary Analysis of the Component Variables … 56 4.3 Hypothesis Test ……………………………………… 60 4.4 Factors Affecting Customer Loyalty ………………… 66 SUMMARY, CONCLUSION AND RECOMMENDATION Summary…………….……………………………………… 86 Conclusions ………………………………………………… 89 Recommendations ………………………………………… 91 REFERENCES ……………………… ………………………………… 98 APPENDICES …………………………………………………………… 101 CURRICULUM VITAE …………………………………………………… 189 vii LIST OF TABLES TABLE 3.1 PAGE Factors Affecting Customer Communication Services Loyalty in Mobile 42 3.2 The Distributive Sample by Service Provider 44 3.3 Cronbach Alpha of Component Services Quality 46 3.4 Cronbach’s Alpha of the Component Switching Barriers 50 4.1 The Distributive Sample by the Gender and Age 54 4.2 The Distributive Sample by the Gender and the Market Share 55 The Distributive Sample by Services Type and the Market Share of Service Providers 55 The Summary of the Distributive Sample by Gender, Age and Type of Service Providers 56 4.5 How to Calculate the Average Value of the Variable 57 4.6 The Mean Value of Service Quality 59 4.7 The Mean Value of Switching Barrier 60 4.8 Correlation Coefficients of Variables 63 4.9 Correlation Coefficients of Switching Barrier and Customer Loyalty Variables 66 4.10 Relationship Between Gender with Service Providers 67 4.11 Relationship Between Education of Subscribers with Selection Service Providers 69 Relationship Between Selections of Service Provider with Occupation of the Subscribers 70 Relationship Between Selection of Service Provider With Per Average Income of Subscribers 71 Relationship between Value - Add Service with Gender of Subscribers 72 Relationship between “Adapting Cost” with Gender of Subscribers 73 4.3 4.4 4.12 4.13 4.14 4.15 viii TABLE 4.16 4.17 4.18 4.19 PAGE Relationship Between Calling Quality of Service Providers with Per Average Income of Subscribers 76 Relationship Between the Adapting Cost with Subscriber’s Ages 77 Relationship Between Assessment About “The Supplier Has Service Packages With Different Charge to Suitable Customer Demands” With Education Level of Subscribers 79 Model Summary 81 ix LIST OF FIGURES FIGURE PAGE The Market Share of Mobile Subscribers in Hanoi, 2011 and 2012 15 Proposed Integrated Model of Service Loyalty 31 Switching Barrier Model of Customer Loyalty 32 Customer Loyalty about Mobile Communication Service in American 36 The Model of Impacting Satisfaction and Switching Barrier to Customer Loyalty the Mobile Communication Service in Korea 37 The Proposed Model for Mobile Communication Service in Hanoi 40 x 175 3.5.6 Education level withThe supplier has service packages with differ ent charges to suitable customer demands Crosstab Education Below than high school diploma High school diploma Associate degree Bachelor degree Master degree an upper Total Count % Count % Count % Count % Count % Count % The supplier has service packages with different charges to suitable customer demands Strongly Disagree Normal Agree agree 3 18.2% 27.3% 27.3% 27.3% 25 5.0% 12.5% 62.5% 20.0% 31 104 31 1.2% 18.5% 61.9% 18.5% 10 11 95 40 6.4% 7.1% 60.9% 25.6% 15 8.0% 12.0% 60.0% 20.0% 18 53 242 87 4.5% 13.2% 60.5% 21.8% Total 11 100.0% 40 100.0% 168 100.0% 156 100.0% 25 100.0% 400 100.0% Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df Asymp Sig (2-sided) 24.532a 24.641 1.415 12 12 017 017 234 400 a cells (30.0%) have expected count less than The minimum expected count is 50 176 3.5.7 Education level with Calling quality Crosstab Calling Quality Education Total Below than high school diploma Count 2 Strongly agree % 18.2% 18.2% 54.5% 9.1% 100.0% High school diploma Count % Count % Count % Count 7.5% 11 6.5% 4.5% 28 70.0% 99 58.9% 90 57.7% 9 22.5% 52 31.0% 53 34.0% 10 0% 3.6% 3.8% 40 100.0% 168 100.0% 156 100.0% 25 % 12.0% 36.0% 40.0% 12.0% 100.0% Count % 26 6.5% 228 57.0% 130 32.5% 16 4.0% 400 100.0% Associate degree Bachelor degree Master degree an upper Total Disagree Normal Agree 11 Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df 20.594a 20.827 2.314 12 12 Asymp Sig (2sided) 057 053 128 400 a cells (35.0%) have expected count less than The minimum expected count is 44 177 3.5.8 Education level with Pricing structure Crosstab Pricing structure Education Below than high school diploma Count Strongly disagree % High school diploma Total Strongly agree 0% 0% 54.5% 36.4% 9.1% 100.0% Count % Count % Count % Count 0% 0% 6% 10.0% 19 11.3% 5.1% 14 35.0% 62 36.9% 51 32.7% 11 19 47.5% 74 44.0% 84 53.8% 10 7.5% 13 7.7% 12 7.7% 40 100.0% 168 100.0% 156 100.0% 25 % 0% 4.0% 44.0% 40.0% 12.0% 100.0% Count % 2% 32 8.0% 144 36.0% 191 47.8% 32 8.0% 400 100.0% Value df Asymp Sig (2sided) Pearson Chi-Square 11.943a 16 748 Likelihood Ratio 12.997 16 673 Linear-by-Linear Association 1.417 234 Associate degree Bachelor degree Master degree an upper Total Disagree Normal Agree 11 Chi-Square Tests N of Valid Cases 400 a 12 cells (48.0%) have expected count less than The minimum expected count is 03 178 3.5.9 Education level with Value - add service Crosstab Value - add service Education Below than high school diploma High school diploma Associate degree Bachelor degree Master degree an upper Total Strongly Strongly Total Disagree Normal Agree disagree agree Count % 9.1% 27.3% Count % 0% 5.0% Count 18 % 1.2% 10.7% Count 11 % 6% 7.1% Count % 0% 16.0% Count 38 % 1.0% 9.5% 11 9.1% 45.5% 9.1% 100.0% 21 15 40 52.5% 37.5% 5.0% 100.0% 85 60 168 50.6% 35.7% 1.8% 100.0% 74 65 156 47.4% 41.7% 3.2% 100.0% 12 25 48.0% 32.0% 4.0% 100.0% 193 153 12 400 48.2% 38.2% 3.0% 100.0% Chi-Square Tests Value df Asymp Sig (2sided) Pearson Chi-Square 22.833a 16 118 Likelihood Ratio 19.111 16 263 Linear-by-Linear Association 223 637 N of Valid Cases 400 a 13 cells (52.0%) have expected count less than The minimum expected count is 11 179 3.5.10 Education level with Convenience in procedure Crosstab Convenience in procedure Education Below than high school diploma High school diploma Associate degree Bachelor degree Master degree an upper Total Strongly Strongly Total Disagree Normal Agree disagree agree Count % 0% 18.2% Count % 0% 2.5% Count 17 % 6% 10.1% Count 15 % 0% 9.6% Count 1 % 4.0% 4.0% Count 36 % 5% 9.0% 11 45.5% 27.3% 9.1% 100.0% 21 17 40 52.5% 42.5% 2.5% 100.0% 94 49 168 56.0% 29.2% 4.2% 100.0% 84 48 156 53.8% 30.8% 5.8% 100.0% 15 25 60.0% 28.0% 4.0% 100.0% 219 124 19 400 54.8% 31.0% 4.8% 100.0% Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df 14.864a 12.695 162 16 16 Asymp Sig (2sided) 535 695 687 400 a 12 cells (48.0%) have expected count less than The minimum expected count is 06 180 3.5.11 Education level with Customer support service Crosstab Education Below than high school diploma High school diploma Associate degree Bachelor degree Master degree an upper Total Count % Count % Count % Count % Count % Count % Customer Support Service Strongly Disagree Normal Agree agree 0 18.2% 81.8% 0% 0% 29 2.5% 72.5% 22.5% 2.5% 127 38 1.8% 75.6% 22.6% 0% 117 30 5.1% 75.0% 19.2% 6% 18 4.0% 72.0% 24.0% 0% 15 300 83 3.8% 75.0% 20.8% 5% Total 11 100.0% 40 100.0% 168 100.0% 156 100.0% 25 100.0% 400 100.0% Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df 16.146a 15.239 064 12 12 Asymp Sig (2-sided) 185 229 800 400 a cells (45.0%) have expected count less than The minimum expected count is 06 181 3.5.12 Education level with Loss cost Crosstab Loss cost Education Strongly Disagree Normal disagree Agree Strongly agree Total Below than high school diploma Count 11 % 18.2% 36.4% 9.1% 27.3% 9.1% 100.0% High school diploma Count 12 13 40 % 0% 20.0% 30.0% 32.5% 17.5% 100.0% Associate degree Count 31 64 47 20 168 % 3.6% 18.5% 38.1% 28.0% 11.9% 100.0% Bachelor degree Count 24 46 58 23 156 % 3.2% 15.4% 29.5% 37.2% 14.7% 100.0% Master degree an upper Count 25 % 12.0% 24.0% 16.0% 32.0% 16.0% 100.0% Count 16 73 127 129 55 400 % 4.0% 18.2% 31.8% 32.2% 13.8% 100.0% Total Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df 24.226a 22.413 882 16 16 Asymp Sig (2sided) 085 130 348 400 a cells (36.0%) have expected count less than The minimum expected count is 44 182 3.5.13 Education level with Adapting cost Crosstab Adapting cost Education Below than high school diploma High school diploma Associate degree Bachelor degree Master degree an upper Total Count % Count % Count % Count % Count % Count % Strongly Strongly Total Disagree Normal Agree disagree agree 0 1 11 0% 0% 81.8% 9.1% 9.1% 100.0% 0 21 12 40 0% 0% 52.5% 30.0% 17.5% 100.0% 92 47 23 168 1.2% 2.4% 54.8% 28.0% 13.7% 100.0% 90 44 20 156 0% 1.3% 57.7% 28.2% 12.8% 100.0% 0 13 25 0% 0% 52.0% 28.0% 20.0% 100.0% 225 111 56 400 5% 1.5% 56.2% 27.8% 14.0% 100.0% Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df 9.220a 11.204 315 16 16 Asymp Sig (2sided) 904 797 575 400 a 13 cells (52.0%) have expected count less than The minimum expected count is 06 183 3.5.14 Education level with Move in cost Crosstab Move in cost Education Below than high school diploma High school diploma Associate degree Bachelor degree Master degree an upper Total Count % Count % Count % Count % Count % Count % Disagree Normal Agree 9.1% 7.5% 17 10.1% 12 7.7% 8.0% 35 8.8% 81.8% 34 85.0% 145 86.3% 134 85.9% 23 92.0% 345 86.2% 0% 2.5% 3.6% 4.5% 0% 14 3.5% Strongly agree 9.1% 5.0% 0% 1.9% 0% 1.5% Total 11 100.0% 40 100.0% 168 100.0% 156 100.0% 25 100.0% 400 100.0% Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df 13.163a 13.731 269 12 12 Asymp Sig (2sided) 357 318 604 400 a 11 cells (55.0%) have expected count less than The minimum expected count is 17 184 3.5.15 Education level with attractiveness of other service providers Crosstab Education Below than high school diploma High school diploma Associate degree Bachelor degree Master degree an upper Total Count % Count % Count % Count % Count % Count % Attractiveness of other service provider Strongly Strongly Disagree Normal Agree disagree agree 0% 18.2% 45.5% 36.4% 0% 11 15 7.5% 20.0% 27.5% 37.5% 7.5% 47 44 59 11 4.2% 28.0% 26.2% 35.1% 6.5% 53 48 45 3.2% 34.0% 30.8% 28.8% 3.2% 8 12.0% 20.0% 32.0% 32.0% 4.0% 18 115 116 131 20 4.5% 28.8% 29.0% 32.8% 5.0% Total 11 100.0% 40 100.0% 168 100.0% 156 100.0% 25 100.0% 400 100.0% Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df 14.726a 14.783 2.774 16 16 Asymp Sig (2sided) 545 541 096 400 a cells (36.0%) have expected count less than The minimum expected count is 50 185 3.5.16 Education level with Customer relationship Crosstab Customer Relationship Education Count % Count High school diploma % Count Associate degree % Count Bachelor degree % Master degree an Count upper % Count Total % Below than high school diploma Strongly disagree 18.2% 2.5% 16 9.5% 5.8% 4.0% 29 7.2% Disagree Normal 27.3% 13 32.5% 53 31.5% 36 23.1% 32.0% 113 28.2% 36.4% 11 27.5% 55 32.7% 67 42.9% 20.0% 142 35.5% Agree 18.2% 14 35.0% 41 24.4% 41 26.3% 10 40.0% 108 27.0% Strongly agree 0% 2.5% 1.8% 1.9% 4.0% 2.0% Total 11 100.0% 40 100.0% 168 100.0% 156 100.0% 25 100.0% 400 100.0% Chi-Square Tests Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Value df 16.907a 16.960 2.001 16 16 Asymp Sig (2sided) 392 388 157 400 a 11 cells (44.0%) have expected count less than The minimum expected count is 22 186 Appendix Results of Regression and Correlation Model Summary Model R R Square Adjusted R Square 859a 912b 926c 936d 944e 949f 950g 737 832 858 877 892 900 903 737 831 857 875 890 899 902 Std Error of the Estimate 41500 33216 30632 28564 26787 25712 25375 ANOVA Model Regression Residual Total Regression Residual Total Regression Residual Total Regression Residual Total Regression Residual Total Regression Residual Total Regression Residual Total Sum of Squares 192.451 68.546 260.998 217.198 43.800 260.998 223.840 37.157 260.998 228.769 32.228 260.998 232.727 28.270 260.998 235.016 25.982 260.998 235.757 25.240 260.998 df Mean Square F Sig 398 399 397 399 396 399 395 399 394 399 393 399 392 399 192.451 172 1.117E3 000a 108.599 110 984.334 000b 74.613 094 795.185 000c 57.192 082 700.969 000d 46.545 072 648.694 000e 39.169 066 592.475 000f 33.680 064 523.068 000g 187 Coefficients Model B Std Error 193 072 800 024 (Constant) -.019 059 Customer relationship 499 028 Loss cost 344 023 (Constant) -.633 091 464 026 (Constant) Customer relationship Customer relationship Loss cost Standardized Coefficients t Sig Beta Collinearity Statistics Tolerance VIF 1.000 1.000 2.675 008 33.428 000 -.318 751 536 17.983 000 476 2.100 446 14.977 000 476 2.100 -6.935 000 498 17.897 000 464 2.155 859 295 022 383 13.463 000 443 2.255 Calling quality 252 030 185 8.414 000 743 1.345 (Constant) 279 145 1.927 055 Customer relationship 396 026 425 15.370 000 410 2.442 Loss cost 237 022 307 10.855 000 390 2.562 Calling quality 242 028 178 8.661 000 742 1.348 Attractiveness of other service provider -.162 021 -.198 -7.773 000 481 2.079 (Constant) -.101 145 -.696 487 Customer relationship 322 026 346 12.347 000 351 2.852 205 021 266 9.825 000 374 2.672 Loss cost Calling quality Unstandardized Coefficients 242 026 178 9.223 000 742 1.348 Attractiveness of other providers -.153 020 -.187 -7.806 000 479 2.087 Convenience in procedure 206 028 172 7.427 000 511 1.957 (Constant) -.336 145 -2.314 021 Customer relationship 271 026 291 10.246 000 313 3.191 Loss cost 189 020 245 9.327 000 367 2.724 Calling quality 201 026 148 7.695 000 689 1.451 Attractiveness of other providers -.143 019 -.174 -7.548 000 475 2.105 Convenience in procedure 190 027 159 7.092 000 506 1.977 Pricing structure 167 028 144 5.884 000 426 2.349 (Constant) -.404 145 -2.794 005 260 026 279 9.849 000 308 3.246 178 020 232 8.830 000 359 2.788 173 027 127 6.415 000 627 1.595 Customer relationship Loss cost Calling quality 188 Attractiveness of other providers -.140 019 -.171 -7.516 000 474 2.108 Convenience in procedure 162 028 136 5.884 000 463 2.161 Pricing structure 163 028 141 5.836 000 425 2.352 Value - add service 097 029 080 3.393 001 443 2.259 Predictors: (Constant), Customer relationship Predictors: (Constant), Customer relationship, Loss cost Predictors: (Constant), Customer relationship, Loss cost, Calling quality Predictors: (Constant), Customer relationship, Loss cost, Calling quality, Attractiveness of other providers Predictors: (Constant), Customer relationship, Loss cost, Calling quality, Attractiveness of other providers, Convenience in procedure Predictors: (Constant), Customer relationship, Loss cost, Calling quality, Attractiveness of other providers, Convenience in procedure, Pricing structure Predictors: (Constant), Customer relationship, Loss cost, Calling quality, Attractiveness of other providers, Convenience in procedure, Pricing structure, Value - add service 189 CURRICULUM VITAE I Personal information Full Name: NGO ANH CUONG English Name: SMILE Sex: Male Date of Birth: January 30th, 1981 Place of Birth: Ha Dong, Ha Noi, Viet Nam Nationality Vietnamese Contact Address La Khe Ward, Ha Dong district, Ha Noi city cuong_tmc@yahoo.com II Educational Qualification Years Institution Degree 2003-2007 Vietnam National University, Ho chiminh city Master of Economic 1998-2002 National Economic University Bachelor III Working History Years Organization Position 2006-Today University of Labour and Social Affairs Lecturer 2002-2006 The central Statistical School Lecturer I, the undersigned, certify that to the best of my knowledge and belief, this information correctly describes me, my qualification and experience ... entitled FACTORS AFFECTING CUSTOMER LOYALTY IN MOBILE COMMUNICATION SERVICES IN HANOI, VIETNAM Submitted in Partial Fulfilment of the Requirements for the Degree DOCTOR OF BUSINESS ADMINISTRATION... the mobile subscribers to mobile communication services in Hanoi, Vietnam The main tool is a questionnaire used to gather information on customer loyalty for mobile service providers in Hanoi Since... motivational factors to maintain customer loyalty as well as an essential element for business and increasing market share Currently, Hanoi is one of the cities in Vietnam that has a great number of mobile