The impact of store images on consumer loyalty

MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY  NGUYEN VAN CUONG THE IMPACT OF STORE IMAGES ON CONSUMER LOYALTY MASTER OF BUSINESS ADMINISTRATION THESIS Ho Chi Minh City, July 2011 MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY  NGUYEN VAN CUONG THE IMPACT OF STORE IMAGES ON CONSUMER LOYALTY Major: Business Administration Major code: 60.34.05 MASTER OF BUSINESS ADMINISTRATION THESIS Supervisor: DR NGUYEN DINH THO Ho Chi Minh City, July 2011 ACKNOWLEDGEMENTS Firstly, I would like to express my sincere gratitude to my supervisor, Dr Nguyen Dinh Tho for the patient, dedicated guidance and valuable suggestions for this thesis over the past few months Also, I am particularly grateful for Mr Tran Khoa Van – GfK Managing Director and GfK management board who inspire the study and contribute valuable figures about retailer evolution in Vietnam Next, I would like thanks to my colleagues Mr Huynh Phuoc Cuong – Senior Manager of Retail Management and Mrs Nguyen Ngoc Lan Huong – Senior Research Manager in helping me to conduct and analyze the qualitative study I also would to express my gratitude to management boards of the three consumer electronics retailers: Nguyen Kim, Thien Hoa and Cho Lon for the keen support in letting me collect shopper information during the qualitative research My heartiest thanks are also sent to Mrs Pham Thi Thanh Nhan, senior assistant of Charles Sturt University Australia (CSU) for her non-stop support on books and online journal article Finally, I would like to send my deep appreciation to more than 500 postgraduate students of University of Economics Ho Chi Minh City, who contributed valuable ideas and assessment for the whole pilot and main survey Ho Chi Minh City, Vietnam July, 2011 Nguyen Van Cuong i ABSTRACT The area of consumer loyalty has received considerable attention during the past few years, both in academic and practice area Many retail research has been conducted to answer for the questions such as: what is the most accurate definitions of consumer loyalty; are there any models/ generalizations when investigating consumer loyalty; what the management implications would be for those researches There are many antecedent factors affecting consumer loyalty, store image dimensions were discovered to be among the most important loyalty drivers In order to indentify the key determinant image elements and understand their derived importance, this study was implemented The research successfully explored the significant relationship between Store Service (Employee Service and After-sales Service), Store Facilities (Physical Facilities and Store Atmosphere), Product & Marketing Communication (Merchandising and Advertising & Promotions), Perceived Price and Store Convenience with Consumer Loyalty Also, these independent factors were also discovered that they not equally affect on consumer loyalty One qualitative study with in-depth interview and one pilot study were performed before the main survey was conducted in Ho Chi Minh City to assess modern trade consumer electronics retailers The study revealed that five key factors (Store Service, Store Facilities, Product & Marketing Communication, Perceived Price and Store Convenience) positively affect consumer loyalty Besides, the study suggested that Store Facilities and Product & Marketing Programs were the two most important factors to be invested in modern retailing industry ii TA CHAPTER INTRODUCTION 1.1 Research background 1.2 Problem statement 1.3 Research questions 1.4 Research objectives 1.5 Research scope 1.6 Research methodology and design 1.7 The significance of research 1.8 Thesis structure 1.9 Summary CHAPTER LITERATURE REVIEW and THEORETICAL MODEL 2.1 Consumer loyalty definitions 2.2 Store image definitions 2.2.1 Store convenience 2.2.2 Physical facilities 2.2.3 Perceived price 2.2.4 Employee service 2.2.5 Advertising and pro 2.2.6 After-sales service 2.2.7 Store atmosphere 2.2.8 Merchandising 2.3 Store image studies 2.4 The relationship between store images and consumer loyalt 2.5 Theoretical model and hypotheses 2.5.1 Theoretical model 2.5.2 Hypotheses 2.6 Summary iii CHAPTER RESEARCH METHODOLOGY 3.1Research process 3.2Qualitative Study 3.2.1Objectives 3.2.2Methodology 3.2.3Sample size and targe 3.2.4In-depth interview co 3.2.5Qualitative result 3.3Measurement 3.3.1Measure of consumer 3.3.2Measure of store 3.3.3Measure of physical f 3.3.4Measure of perceived 3.3.5Measure of employee 3.3.6Measure of advertisin 3.3.7Measure of after-sale 3.3.8Measure of store atm 3.3.9Measure of merchand 3.4Quantitative Pilot study 3.4.1Objectives 3.4.2Methodology 3.4.3Target respondent and 3.4.4Pilot study content 3.4.5Pilot study result 3.5 Model and hypotheses modification 3.5.1Model modification 3.5.2Hypotheses modifica 3.5.3Variables iv 3.6Main survey 3.6.1Methodology 3.6.2Target respondent and 3.6.3Questionnaire conten 3.6.4Data analysis method 3.7Summary CHAPTER DATA ANALYSIS AND RESULT 4.1Sample characteristics 4.2Cronbach’ alpha reliability analysis 4.3Exploratory factor analysis 4.4Multiple linear regression 4.5Hypotheses assessment and discussion 4.6Summary CHAPTER CONCLUSIONS AND IMPLICATIONS 5.1Conclusions 5.2Managerial implications 5.2.1Store facilities 5.2.2Product and marketin 5.2.3Perceived price 5.2.4Store service 5.2.5Store convenience 5.3Limitations and future research 5.3.1Research limitations 5.3.2Future research 5.4Summary REFERENCES APPENDIX 1: Overview of Vietnam Retailing Market APPENDIX 2: Data analysis v APPENDIX 3: Questionnaire 69 LIST OF TABLES Table 3-1: Qualitative result – important factor to retain loyal customers 24 Table 3-2: Qualitative result – important factor to retain loyal customers 25 Table 3-3: Cronbach alpha result for pilot study 31 Table 3-4: Rotated component matrix for pilot study 33 Table 4-1: Descriptive analysis 42 Table 4-2: Average number in one household and average household monthly income .44 Table 4-3: Cronbach alpha result for main survey 44 Table 4-4: EFA rotated component matrix for main survey 47 Table 4-5: Total variance explained 48 Table 4-6: KMO and Bartlett’s Test 49 Table 4-7: Regression model summary 49 Table 4-8: ANOVA F test 50 Table 4-9: Multiple linear regression result for main survey 50 Table 1-1: Vietnam retail outlet evolution of home technology product 63 Table 1-2: Organized/ chain store vs independent channel evolution 63 Table 1-3: Ranking of Retail Market Attractiveness 63 Table 4-10: Descriptive statistic 64 Table 4-11: Correlation between Consumer loyalty, Store Service, Store Facilities, Product & Marketing Communication, Store Convenience and Perceived Price 65 Table 4-12: Communalities 66 vi LIST OF FIGURES Figure 2-1: Theoretical model 17 Figure 3-1: Research Process 22 Figure 3-2: Modified theoretical model 36 Figure 4-1: Result of multiple linear regression 51 Figure 4-2: EFA Scree Plot 64 Figure 4-3: Histogram of Consumer Loyalty 67 Figure 4-4: Normal P-P Plot of Consumer Loyalty 67 Figure 4-5: Scatter plot of Consumer Loyalty 68 vii CHAPTER INTRODUCTION 1.1 Research background In recent years, the rapid growth of retailers in both quantity and channels (supermarket, hypermarket, exclusive single brand stores) has resulted in a corresponding increase in the competition between retailers The understanding of what motivates consumers to purchase from one stores rather than another becomes increasingly important to retail stores design and management (Black et al., 2002) In Asia, retailing has been still one of the most attractive industries over the past few years Vietnam, an emerging country with a dynamic economy and a potential entry market with more than 85 million people, will be a prosperous land to invest According to the Global Retail Development Index 2010 of American consulting company AT Kearney, Vietnam was ranked as the 14 th in 30 countries having the most attractive retailing industry worldwide The retailing industry is still considered as an attractive industry because Vietnam has a young population and promises a robust growth of the industry Furthermore, after joining WTO, Vietnamese government continued encouraging and supporting local retailers to participate and expand in the regional retailing industry to keep pace with neighbor countries like Thailand, Singapore or Malaysia The growing of retail industry in Vietnam is recorded to be in both channel and outlet development Firstly, regarding number of outlet, according GfK Vietnam (see appendix 1, table 1.1), the total number of retailers selling technology products is expected to increase significantly in 2011 (44%) compared to 2010 Of which, telecom group (mobile phone retailer) has the largest number of retail store (19,347 outlets) Secondly, modern trade channels continued to emerge despite the dominance of traditional channels Consumers have been interested in shopping at supermarkets, hypermarkets and convenience stores because of their pleasant environment as well as their diversified product ranges In addition, modern trade channels try their best to offer consumers a more competitive price to compete with traditional channels Consumers also preferred to come to modern consumer electronics stores because they could freely look, touch and try products that they wanted GfK retail audit recorded a positive growth in revenue Q5b Đối vớ i nhân tố, xin vui lòng nêu điểm cụ thể mà anh/chị cảm thấy hài lịng khơng hài lịng hoạt động khách hàng thân thuộc Sự thuận tiện Giá Quảng cáo & khuyến Khơng khí/khơng gian mua sắm 72 Quantitative Pilot Study - English Questionnaire STUDY ABOUT CONSUMER ELECTRONICS RETAILER Full Name: _ Class: _ Phone: Email: _ Hello, I am Nguyen Van Cuong, a student of a post graduate program at University of Economics I am conducting a study about consumer electronics retailer in HCM City and would like to invite you to take part in a short survey Your provided information will not revealed to any third parties without your written confirmation The result of the study will be statistically analyzed and represented in a general view, and will not reveal individual information Please read through the following questions before answering Some of them require a single answer, some ask for multiple answers SCREENING Q1 Gender Male Q2 Female Age 18-25 Q3 Have you or any members in your household purchased any consumer electronics item during the past 12 months? We would like to mention about one of the following home items - TV, DVD player, MP3/MP4 player, digital camera, digital camcorder - Mobile phone, telephone - Refrigerator, washing machine, air conditioner, microwave oven, vacuum cleaner - Desktop PC, laptop, printer Yes Q4 No (End the survey) Which of the following statement best describe your decision making role in selecting consumer electronics retailer? I am the key decision maker/ joint-maker in selecting consumer electronics retailer Other members in my family make decision to choose consumer electronics retailer (End the survey) MAIN QUESTIONS Q5 Please name ONE consumer electronics retailer that you purchase most frequently during the past 12 month Q6 The following statements are about consumer electronics retailer Please let us know how relevant each of the statement is to your most-often-purchased store Please use a scale from to 7, where is “strongly disagree” and is “strongly agree” and circle the corresponding number 73 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THANK YOU FOR YOUR COOPERATION 74 Quantitative Pilot Study - Vietnamese Questionnaire NGHIÊN CỨU VỀ CÁC TRUNG TÂM/ SIÊU THỊ ĐIỆN MÁY Họ Tên: _ Lớp: _ ĐT: Email: _ Chào anh/chị, Nguyễ n Văn Cường, sinh viên sau đại học trường Đại Học Kinh Tế TPHCM Hiệ n th ực đề tài sau đại học để nghiên cứu trung tâm siêu th ị điện máy TPHCM muốn mời anh/chị tham gia khảo sát ngắn.Thông tin anh/ chị cung cấ p ch ỉ sử dụng phạm vi khảo sát không tiết lộ cho bên thứ ba mà ch ưa có đồng ý anh/ chị Những kết có từ khảo sát trình bày dạng thơng tin thống kê tổng quát, thông tin cá nhân liên quan đến anh/ch ị Xin vui lòng đọc kỹ trước trả lời các câu hỏi d ưới Đố i vớ i vài câu hỏ i, anh/ chị yêu cầu chọn đáp án số nhiều đáp án đưa Đối với câu hỏi khác, anh/chị chọn nhiều đáp án PHẦN GẠN LỌC Q1 Giới Tính Nam Q2 Nữ Tuổi 18-25 Q3 Xin vui lòng cho biết anh/chị hay gia đình anh/chị có mua sản phẩm kim khí điện máy trong vịng 12 tháng qua không? Ở muốn đề cập đến sản phẩm kim khí điện máy như: - Tivi, đầu đĩa DVD, máy nghe nhạc MP3/MP4, máy chụp ảnh kỹ thuật số, máy quay phim - Điện thoại di động, điện thoại bàn - Tủ lạnh, máy giặt, máy lạnh, lị vi sóng, máy hút bụi - Máy vi tính để bàn, máy vi tính xách tay, máy in Có Q4 Khơng (Ngưng Khảo Sát) Nhận định sau mô tả việc tham gia định anh/chị lựa chọn trung tâm/siêu thị kim khí điện máy Tơi người định tham gia định để chọn trung tâm/ siêu thị điện máy Những người khác gia đình tơi định chọn trung tâm/ siêu thị điện máy (Ngưng Khảo Sát) CÂU HỎI CHÍNH Q5 Xin vui lịng cho biết anh/ chị mua sắm hàng kim khí điện máy thường xuyên trung tâm/ siêu thị vòng 12 tháng qua Q6 Sau số nhận định trung tâm/siêu thị điện máy Xin vui lòng cho biế t mức độ phù hợp nhận định theo thang điểm từ đến với “hồn tồn khơng đồng ý” đến “Hồn tồn đồng ý” Xin khoanh trịn MỘT số thích hợp cho câu nhận định 75 10 11 12 13 14 15 16 17 18 19 20 21 22.hàng 23 24 25 26 27 28 29 CÁM ƠN SỰ HỢP TÁC CỦA ANH/ CHỊ 76 Main Survey - English Questionnaire STUDY ABOUT CONSUMER ELECTRONICS RETAILER Full Name: _ Class: _ Phone: Email: _ Hello, I am Nguyen Van Cuong, a student of a post graduate program at University of Economics I am conducting a study about consumer electronics retailer in HCM City and would like to invite you to take part in a short survey Your provided information will not revealed to any third parties without your written confirmation The result of the study will be statistically analyzed and represented in a general view, and will not reveal individual information Please read through the following questions before answering Some of them require a single answer, some ask for multiple answers SCREENING Q1 Gender Male Q2 Female Age 18-25 Q3 Have you or any members in your household purchased any consumer electronics item during the past 12 months? We would like to mention about one of the following items - TV, DVD player, MP3/MP4 player, digital camera, digital camcorder - Mobile phone, telephone - Refrigerator, washing machine, air conditioner, microwave oven, vacuum cleaner - Desktop PC, laptop, printer Yes Q4 No (End the survey) Which of the following statement best describe your decision making role in selecting consumer electronics retailer? I am the key decision maker/ joint-maker in selecting consumer electronics retailer Other members in my family make decision to choose consumer electronics retailer (End the survey) MAIN QUESTIONS Q5 Please name ONE consumer electronics retailer that you purchase most frequently during the past 12 month Q6 The following statements are about consumer electronics retailer Please let us know how relevant each of the statement is to your most-often-purchased store Please use a scale from to 7, where is “strongly disagree” and is “strongly agree” and circle the corresponding number 77 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Q7 Please indicate your marital status Single Q8 Married Please indicate your current occupation Company employee (private or foreign company) Government employee 78 Q9 How many members are there in your household including yourself: peop Q10 Please indicate your average household monthly income? Less than mil VND – mil VND – 10 mil VND 79 Main Survey - Vietnamese Questionnaire NGHIÊN CỨU VỀ CÁC TRUNG TÂM/ SIÊU THỊ ĐIỆN MÁY Họ Tên: _ Lớp: _ ĐT: Email: _ Chào anh/chị, Nguyễ n Văn Cường, sinh viên sau đại học trường Đại Học Kinh Tế TPHCM Hiệ n th ực đề tài sau đại học để nghiên cứu trung tâm siêu th ị điện máy TPHCM muốn mời anh/chị tham gia khảo sát ngắn.Thông tin anh/ chị cung cấ p ch ỉ sử dụng phạm vi khảo sát không tiết lộ cho bên thứ ba mà ch ưa có đồng ý anh/ chị Những kết có từ khảo sát trình bày dạng thơng tin thống kê tổng quát, thông tin cá nhân liên quan đến anh/ch ị Xin vui lòng đọc kỹ trước trả lời các câu hỏi d ưới Đố i vớ i vài câu hỏ i, anh/ chị yêu cầu chọn đáp án số nhiều đáp án đưa Đối với câu hỏi khác, anh/chị chọn nhiều đáp án Q1 Giới tính Nam Q2 Tuổi Q3 Xin vui lịng cho biết anh/chị hay gia đình anh/chị có mua sản phẩm kim khí điện máy trong vịng 12 tháng qua khơng? Ở chúng tơi muốn đề cập đến sản phẩm kim khí điện máy như: - Tivi, đầu đĩa DVD, máy nghe nhạc MP3/MP4, máy chụp ảnh kỹ thuật số, máy quay phim - Điện thoại di động, điện thoại bàn - Tủ lạnh, máy giặt, máy lạnh, lị vi sóng, máy hút bụi - Máy vi tính để bàn, máy vi tính xách tay, máy in Có Q4 Khơnng (Ngưng Khảo Sát) Nhận định sau mô tả việc tham gia định anh/chị lựa điện máy Tôi người định tham gia định để chọn trung tâm/ siêu Những người khác gia đình tơi định chọn trung tâm/ siêu thị điện m Q5 Q6 Xin vui lòng cho biết anh/ chị mua sắm hàng kim khí điện máy thường xuyên vòng 12 tháng qua Sau số nhận định trung tâm/siêu thị điện máy Xin vui lòng cho biế t mức độ phù hợp nhận định theo thang điểm từ đến với “hồn tồn khơng đồng ý” đến “Hoàn toàn đồng ý” Xin khoanh trịn MỘT số thích hợp cho câu nhận định 80 6.Bố trí lối chung phù hợp 7.Nội thất trang trí đẹp mắt 8.Hàng hóa bố trí trưng bày hợp lý 9.Khơng gian bên trung tâm/siêu thị dễ di chuyển 10 Nhân viên bán hàng thân thiện 11 12 13 Giao hàng tận nơi lắp ráp miễn phí 14 Dịch vụ bảo hành chu đáo 15 hàng 16 17 18 19 20 21 22 23 24 Thường xuyên tổ chức kiện cho khách hàng thân thiết 25 26 27 28 29 Q7 Độc thân 81 Q8 Vui lòng cho biết nghề nghiệp anh/ chị Nhân viên cơng ty tư nhân/ nước ngồi Cơng chức nhà nước Q9 Vui lịng cho biết có thành viên gia đình anh/ chị (kể anh/chị) ngư Q10 Anh/Chị vui lòng cho biết tổng thu nhập hàng tháng hộ gia đình anh/chị bao nhiêu? Dưới triệu – triệu – 10 triệu 82 ... his or her perception of the store Some researches about consumer loyalty focus on the impact of service quality on consumer loyalty intentions, a measurement of consumer loyalty Sirohi et al.,... effect on consumer loyalty intentions; and perceived value of competitor has a negative effect on consumer loyalty intentions (the higher the perceived value of competitor, the lower the consumer loyalty. .. and consumer loyalty when they study the influence of store images on retailer equity Store price and values are also found to have impact on consumer loyalty through the mediating role of consumer