Customer Satisfaction with Self Service Checkout
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This chapter explains about the possible literature review about the self service checkout system and its operation in relation with customer satisfaction and retention. It will introduce you to some of the theories about the self service technology, customer satisfaction and retention. At the end, you will find the critical review of this literature review and possible arguments and recommendations.
As companies/supermarkets have race to introduced technology that enables the customers to get service on their own (Bitner, M. Amy, L. Ostrom and Matthew, L. 2002). Growing number of customers interacted with the technology to create service outcomes instead with a service firm employee (Matthew, L. Amy, L. Ostrom, Robert, I. And Bitner, M. July 2000). The overall affect model is based on the consumer's feelings toward the use of technology (Pratibha A. and Dabholkar 1996). The Supermarkets which introduce self-service checkout systems wish to gain rapid acceptance and usage of these technologies by potential consumers. (Jungki, L. and Allaway, A. 2002)
According to Merriam-Webster's Dictionary (2008), Innovation is “a new idea, method or device, or the introduction of something new.”Drejer (2002) argues that innovation is more than just invention, that idea cannot be innovative as a pure, it must be put in practice and be commercialized; otherwise it is too earlier to speak of innovation. Blackmon (1996) provide us with the best summary for a context of this research: “… technological change is used to describe changes in knowledge that increase the volume of output or allow a qualitatively superior output from a given amount of resources … and thus in driving organizational evolution …” The sales profit is a simple conceptual framework chain to linking with the employee satisfaction as well as customer satisfaction and financial performance. This sales profit chain is the relationships between employee and customer satisfaction (Gary, W. and Loveman, 1998). The benefit of the customer retention and satisfaction has been characterized by using the repurchase intention or a factor score of quite a few measures repurchase goal, and price tolerance. So that the purpose to use the customers management strategy that is the based on managing both satisfaction and benefit of customer retention (Narayandas, D. 1998). Performance expectation and the actual performance have major significance in the Evaluation process, as we need to determine the dimension of product and service performance. Most customers do not switch from satisfied seller to their competitors, but, there are several factors that could affect customer behaviour to switch to different service provider such as mistake in core service failure, service encounter failures, variable prices, inconvenience, responsive to service failures, attraction by competitors, ethical behaviours and involuntary switching etc.
(Hawkins, Best and Coney, 2004)
Retailers need to analyze what makes a new product from the point of view by the customer if customers facing problems understanding the reason behind the introduction of new self-service checkout systems (SSC) they will not use the system. As we launch new self-service systems, we need to analyse the consumer behaviour as well. The consumer should be involved in some way or another at most stages in the introduction of self-service checkout system. Every retail or sales companies should take care of customer wants and needs (Wright, R. 2006).
Consumers feel a sense of pleasure in understanding that they have found a unique store that they can, and do, frequent. This suggestion is suggested on the notion of value as a function of both worth (Oliver, 1999) and scarcity. People feel good when they find something of worth that is not easily available the feel good feeling from the ordinary and the mundane, is different from satisfaction in that it consists qualitative effects such as enjoyment and happiness. In contract, satisfaction is an evaluative judgment (Oliver, 1997) and more cognitive in nature (Howard and Sheth, 1969).
Satisfaction can be defined as a cognitive evaluation resulting from the fulfilment expectations. Satisfaction is a judgment based on either a cognitive or emotional appraisal, made by the customer whether his or her expectations were met (Oliver, 1997). Positive affect is a pleasurable emotional response (Bogozzi, Gopinath, and Nyer, 1999).
“If organizations want to consider total customer experience, satisfaction by itself is a weak measurement...” (Barlow and Maul, 2000)
As a result, when a consumer experiences more differentiation value in the store, consumer will be more likely to feel more positive responses toward the store (Holbrook and Hirschman, 1982)
The literature in retailing and customer behaviour has identified commitment as one's “motivation” to keep a relationship with the retailer (Bendapudi and Berry, 1997 and Fournier, 1998).The self-service checkout system (SSC) into the service come across necessitates research to improved understand customers' attitudes toward overhaul providers and technologies, and their intentions to employ technology-based facility delivery systems. In this research, the authors build up and experiment three structural models that include a pecking instruct of consumer attitudes toward together the psychological and the technological factors of the come across to better appreciate their intentions to utilize Self Service Technologies. The result indicates that intentions to exercise self-service technologies options are ambitious by manifold, hierarchical attitudes.
In calculation to the direct belongings of attitudes toward exact self-service technologies and individual employees, the findings corroborate that higher direct worldwide attitudes toward service technologies pressure intentions to use self-service technologies. fascinatingly, the findings indicate that heavy self-service technologies users rely more on attitudes toward specific self-service technologies than do light self-service technologies users, who rely more heavily on universal attitudes toward self-service technologies when formative intention to utilize an self-service technologies.
(James, M. Matthew, L. Meuter and Carol, F. 2003)
Kano Model Analysis:
The customer satisfaction model from professor Kano is a marketing and quality management approach that can be used for assessing and establishing customer satisfaction and happiness. Kano model has six categories of customer quality characteristics, but, only the first three specially relate to customer satisfaction. (Kano, 2007)
These factors are:
a) Basic factors
b) Excitement factors
c) Performance factors
The prerequisite factors that will cause dissatisfaction if they are not met, but, do not establish customer satisfaction. If they are fulfilled or cross expectations customer regard this as essential and basic factors contribute to market entrance ‘threshold'
These requirements if they are met can increase customer level satisfaction, but, if they do not meet the requirements, do not cause customer dissatisfaction. These factors come to customers as surprise and create satisfaction. A company can come out from crowd from competitors in a positive way using these factors.
These factors are concerned with the performance level. So, we can conclude that customer satisfaction is directly related to the performance level, if the performance level is high, then, customer satisfaction will be met, but, if the performance level is low, cause dissatisfaction. These factors are directly related to customer desires, wants and needs etc. So, company should try to be competitive in a market.
Illustration of features or needs vs satisfaction
(Adapted from Prof. Kano, 1994)
Customer point of view in relation to Self Service Checkout System (SSC)
Researcher forecasting about the adaptation of the self service checkout system have been gone against the past recommendation, instead, customers are using this technology more and embrace this technology with open arms.
Reasons for Supermarket to adopt this technology:
- Customers do prefer to use their bank cards in privacy and anonymity.
- Queue awaiting time reduction;
- Need for self-service;
- Quick payment;
- Shoppers feel empowered;
- Retail market is shifting towards radio frequency identification which will replace the bar code.
However this might be a foundation for increasing working hours, as supermarkets not depending on a cashier. Due it is not many research have been done in the UK practise might be relevant for this research and will be in future referred as a compare base.
Porter's competitive advantage theory is a classical and one of the foundational in business literature, however lately it was criticized by some authors (Day and Wensley, 1988 and Hunt and Morgan, 1995). Therefore some complementary concepts have been suggested.
In order to reinforce research the Porter's value-chain theory was complemented with the more current Value-Network model of Stabell and Fjeldstad (Stabell and Fjeldstad, 1998). Value-chain theory and the value network model are presenting the different activities of a company where value can be cond and added through SSC systems. This model allows the researchers to investigate the different activities of companies on which the implementation of technology-based self-service as an innovation can have an effect.
Theoretical Framework Implication
In order to fully understand the impact of introducing Self Service Checkout system (SSC) in ASDA supermarkets it is necessary to look into: role and importance of innovation in a business context, product life cycle connected to SSC; competitive advantage theory and complementary concepts, value chain theory, and finally the importance of customer relationship management in the ‘new' self-service economy.
Before we are going to analyze stage it is important to understand what innovation in business context is. The full understanding can be obtained through definition of the term.
According to Merriam-Webster's Dictionary (2008), Innovation is “a new idea, method or device, or the introduction of something new.”
Drejer (2002) argues that “innovation is more than just invention, that idea cannot be innovative as a pure, it must be put in practice and be commercialized; otherwise it is too earlier to speak of innovation”.
Blackmon (1996) provide us with the best summary for a context of this research: “… technological change is used to describe changes in knowledge that increase the volume of output or allow a qualitatively superior output from a given amount of resources … and thus in driving organizational evolution …”
In the following relation, the innovation in a business context is a product, device, service, programme, service provider, or methods of services delivery that are new, unusual, or in other ways different from those previously used and positively reflects in overall output of the organization in form of added value directly to the organization or its customers. In the case of this research, innovation in form of SSC brings changes into service delivery.
In order to understand the impact of the innovation it is necessary to understand to which area of service delivery it related.
Dabholkar (2003) made a classification of technology in service delivery with three dimensions.
• “By whom the service is delivered and who operates the technology”.
• “Where the service is delivered (at the shop or in customers' home); and how the service is delivered”.
Depending on which category the service belongs to different factors will affect the customer's evaluation of the service quality. This classification can be useful in guiding companies in the development of their marketing strategies when implementing SSC systems.
At service site
At customer's place
Customer goes to service site and performs service using technology at service site. E.g. ATM, self-service at retail checkouts.
Customer uses technology from home/office to perform service. E.g. internet shopping.
Customer goes to service site and uses automated telephone system to perform service. E.g. automated wake-up calls at
Customer calls automated telephone service from home/office to perform service. E.g. automated ticket-ordering over telephone.
Source: Dabholkar, 1994 in Anselmsson, 2001, page 13.
Shadowed cell is the relevant technology for this research. Using this type of SSC, the customer goes to the service site and performs the service by using the technology provided at the service site. This implies a greater importance and wider range of quality issues in the interactive marketing function of the organisation.
Product/service life Cycle
In a business context everything is going through different level, stages of performance. It is similar to the any life development. From the cell of life to the maturity and death, the products are repeating same way from idea to implementation and ultimately death. Particularly in our case the service as well as product must be planned and introduce to employees, customers and eventually be accepted by them. It is crucial for the managers to adjust and control its performance while it goes through different stages. The effect respectively will be also different on different stages. Therefore, considering the life cycle of SSC systems is important when investigating the effects on company competitiveness.
The product life cycle tend to go through the five stages of products:
• Service/product development;
• Market introduction;
• Growth stage;
• Mature stage;
• Stage of decline.
Each stage is different in effectiveness of the product, expenses, revenue, etc. The first stage usually money intensive as there is no sales revenue and all expenses are covered by different organization's activities, in our case no effectiveness gain from reducing cost of operation. Stage two is quite expensive in our case as technological cost is very high.
The purchase of the machineries and shop's infrastructure adjustments to accommodate it are required. Moreover the staff and customer's trainings and special promotions materials must be prepared. The third stage is continuous use of SSC by customers and therefore operational cost reduction becomes positive revenue, which might cover the marketing expenses. The fourth stage is characterised by very low costs of operation as number of customers who is using it increased. The final stage might come as soon as more efficient and productive technology will arrive and current become outdated. (Day, 1981)
The progression of a product through these stages is not certain however. Some products may stay in the mature stage forever, for example commodities such as milk, others might not even rich stage of maturity.
These products go through their life cycle as marketer's “marketing mix” strategies change. For example, advertising is informative stage of the introduction, maturity stages, winning in the growth and in the decline stage reminder-oriented. In the early stages the promotional budget tends to be highest, and as the product gradually taper off matures and decline. Product characteristics, pricing, distribution also tend to change.
The concept of product life cycle, applied to Self Service Checkout System (SSC) innovations, has also been introduced as an important concept that also contributes to affecting competitiveness.
Porter's value chain framework today still is the ‘accepted language' for representing and analyzing the logic of firm-level value creation, and is also a framework for analyzing firm-level competitive strengths and weaknesses.
In value chain analysis “competitive advantage is understood by these discrete activities of the value creation process that contribute to the firm's relation cost place and produce a basis for segregation. These activities are the ‘building blocks' from which a product or process is created that is valuable to the firm's customers. The different activities have different economics and thus contribute differently to the valuable characteristics of the product or process”.
The value creating activities in Porter's model are divided in two levels. “Primary activities consist of directly interact to create and bring value to the customer, while support activities facilitate and develop the performance of the primary activities”.
The primary activity level consists of five actions: inbound logistics, operations, outbound logistics, promotion and sales and service. The maintain actions are procurement, technology growth, human supply management, and firm infrastructure. It is important to note that the different activity categories are not the same as organizational functions. Using the value chain for analysis, “costs and assets are assigned to the value activities as a first step, and are further analyzed as “structural drivers” related to the scale and scope of the firm, linkages across activities, and environmental factors. Cost and value drivers are usually analyzed separately. Moreover, drivers are partly related to internal relationships, partly to external factors, and partly to relationships between internal and external factors as well. The main drivers of value are policy decisions made by product and segment choices when the firm is established or repositioned”.
(Stabell and Fjeldstad, 1998)
According to Porter, “the value-creating logic of his value chain with its generic activity categories is valid for firms in all industries. However, he further states that the specific activities that are vital to a firm's competitive advantage depend on which industry the firm operates”.
(Porter, 1985, 1990)
Stabell and Fjeldstad (1998) however have investigated the application of the value chain model to a variety of industries and have experienced problems in applying the value chain frame work to more than two-dozen firms.
They have found that the value chain is suitable for describing and understanding the value creation logic of manufacturing firms, but that it proves problematic when analyzing activities in service industry firms.
They argue that “problems arise from difficulty to assign and analyze activities in terms of the five generic primary value chain categories proposed by Porter, leading to unclear explanations of value creation”.
Therefore, Stabell and Fjeldstad (1998) suggest that “the value chain can be considered as one of three generic value configurations to facilitate the understanding and analysis of firm-level value-creation logic for a broad range of industries and firms”. The additional two value models besides the value-chain are the value network and the value shop. The importance shop model applies to firms where price is created by “mobilizing income and performance to resolve an exacting customer difficulty”, for example professional service firms dealing with medicine, law, architecture and engineering. The value network model refers to firms that generate cost by “facilitating an organization relationship among their customers using a mediator technology”.
Stabell and Fjeldstad (1998) also propose alternative presentation formats for both models that represent their unique value creation logic. For the purpose of this research both Porter's value chain and Stabell and Fjeldstad's value network is of importance. Although Stabell and Fjeldstad state that according to their findings the value chain is mostly useful for manufacturing firms, for our investigation of supermarkets' ‘traditional' operations, the value chain is most fitting, with one small alteration.
However, in also considering the introduction of a new type of service offering through technology-based self-service checkouts, it is found necessary to complement the value chain model with the value network model in order to be able to capture the value adding activities of SSC. The combination of the different value-creating logics, as suggested for this research, has also been proposed by Norman and Ramirez (1993). Since the main purpose of the research is to investigate the effects of SSC in supermarkets, the value network is of central importance, which is discussed in further detail below.
The Value Network
“Value networks use a ‘mediating technology' to link clients and customers who wish to be interdependent.” According to Stabell and Fjeldstad (1998), “the firm provides a networking service through the mediating technology and thus facilitates exchange relationships among customers distributed in space and time”. For the consideration of SSC, the value network idea is modified to mean that the firm is the network itself, linking its customers not to each other but to the firm itself, facilitating a more interdependent exchange relationship between the firm and its customers.
“To measure the customer satisfaction of how your organisation`s `total product` performs in relation to a set of customer requirements.” (Gower, 1999)
If you like to measure the customer satisfaction of the customers and you need direction exactly what you are measuring. Understanding the concept of customer satisfaction is very easy and can be done by assuming yourself as a customer in a supermarket.
Satisfaction is simple. If you get what you wanted and your requirements are met, you are satisfied. The starting point of a customer satisfaction management is to set the objectives.
There are different customer satisfaction objectives that can be set.
* Customers` requirements (important ratings)
* Customer satisfaction (Satisfaction ratings)
* Comparison with other organizations
* PFIs (priorities for improvement)
* Customer satisfaction index
* A track able measure of satisfaction
* The internal perspective
Firstly, you should identify customers` requirements and there are many things customers want and need but we need to identify most relative of customer requirements.
Secondly, you must measure customer satisfaction. Organisational performance is directly related to customer satisfaction and list of customers` requirements.
Thirdly, if you could go a bit further to analyse the customers` requirements as compared to other same organisations. (In our example `supermarket`) This will give you the opportunity to get the benchmarking. By using benchmarking, you could analyse the requirements of your supermarket customers` as satisfied or not satisfied.
Fourthly, after getting the customers` satisfaction measures, you can use these measures to produce some survey outcomes and the first of that step is to identify the PFIs (Priorities for improvement)
Fifth, you will need to measure the overall customers` satisfaction. We call it a satisfaction index and it will indicate us to monitor progress from the one year to the next for the overall customers` satisfaction.
Finally, customers` satisfaction survey has to be done inside the supermarket to know about the understanding of employees about their customers` requirements. It will help any supermarket to indentify that if their employees know about their customers` requirements and can indentify gaps. An internal survey can also be used to help the management to make the decision making process and strategic management. (Gower, 1999)
Achieving Customer Satisfaction:
“Customer satisfaction is measured frequently. Sampling is extensive. Surveys are quantitative as well as qualitative. The measures are taken very seriously. They are reviewed unfailingly by Top management: the development of such measures is taken very seriously as the development of budgetary measures or product reliability measures. Evaluation of people in all functions at all levels is significantly affected by the satisfaction measures”. (Tom Peter, a Passion for Excellence)
Customer delight seems very credible people say things like:
In today`s competitive markets customer satisfaction is no longer enough; you have to delight the customers, give them something they did not expect to keep their business.
In customer satisfaction, the link between customer loyalty, customer retention and profitability can make get better customer satisfaction. It has been shown that customer retention can boost profit of the supermarket as it is very easy to keep the existing customers than getting new customers.
After getting the trend data and established the satisfaction- loyalty ratio in your market for your organisation, you make some models. Some companies now have `business performance models` based on their customer satisfaction management survey results that have quantified the exact links between customer satisfaction, customer loyalty, sales and profit. They know that how much one percent improvement in customer satisfaction will improve loyalty how much that contributes to profits. Precisely, this is a very powerful forecasting tool.
Customer Satisfaction and the Performance:
Customer satisfaction can be defined as more loyal customer and it involves emotional and complicated process. Every customer has certain level of product or service expectation and desire. If customer expectation level increased as a result of using that product or service, then, customer experiences satisfaction.
(Simon & Homburg 1998, Page 44)
However, “Satisfaction has also recently been described as the emotional reaction to this cognitively defined process of comparison”.
(Homburg and Rudolph 1995, page 31)
In this context, customer experiences that the outcome of the process of comparison will not always give the correct result about the expected satisfaction outcome and actual level of satisfaction outcome. Instead, direct effect of these outcomes or satisfaction levels also interacts with satisfaction.
(Bolton et al. 1991 page 376)
The customer satisfaction has been in research for long time, mostly research and investigation has been done on the customer satisfaction, but, not on the customer retention.
It is the experience and attitude of the employee in closest contact with customers that customers are satisfied, loyal and customer retention has been achieved.
The Satisfaction is an “a overall attitude of customer towards the service provider”
(Levesque and McDougall, 1996)
The companies are more successful, later research has showed if they adopt customer retention rather than customer satisfaction.
Customer satisfaction brings many benefits. Satisfied customers are fewer prices sensitive; they purchase more items, not go to competitors and stay longer.
Customer satisfaction is directly related with the customer complaint process management. If customer complains more, then, it increases more customer satisfaction. Customer complains about the product or service he/she receives, then, supermarket can achieve more customer satisfaction
“The product innovations, staff service, price, convenience and business profile are all determinants of customer satisfaction”.
Later, Bejou et al. (1998) propose that “customer satisfaction can be enhanced through relationships, provided they are developed and managed to the customer`s satisfaction”
Customer retention is not directly related with the customer satisfaction.
Sometime customer do not change service provider because of the alternative circumstances, but, customer satisfaction level remain the same. Sometime customers do not have any choice to change their service provider, so, they stick with their existing provider.
Hallowell (1996) argues that customer satisfaction cannot produce life time customer loyalty even though customer satisfaction has been increased, but, retention can be related with customer satisfaction.
Retention can be understandable as “to do business or exchange a commitment to continue with a particular company on an ongoing basis”.
Retaining old customers are easy and cheap to keep as compared to the new customers because they are more loyal and less price sensitive. They keep their loyalty to their existing service provider and do not change their loyalty to the new service provider. It increases customer retention, satisfaction, lower price sensitivity, higher market share, higher productivity and higher efficiencies.
The authors suggest that in order to retain customers, companies should always change and developing their product and services to meet the ever changing needs of customers.
“The concept of acquiring, developing and retaining customers from a cognitive and affective perspective”, they provide examples of how cognitive and affects are used to increase retention.
(Desai and Mahajan, 1998)
“Customer satisfaction is a direct determining factor in customer loyalty, which, in turn, is a main presentation of customer retention”.
(Gerpott et al., 2001)
Customer satisfaction can be achieved by customer retention. Customer complaint process can boost the stage of customer satisfaction that result in customer retention. Employee perspective is also very important with relation of the customers. Individual relationship with the customer can boost the level of customer satisfaction. It is direct related with the mental theories of customer and employee perspectives. Managers should be aware of customer wants and needs as well as employee mental perspective. Different employees keep different level of relationship with the customers that could affect the customer satisfaction and retention level. Therefore, Managers must keep eye into employee/customer relationship and set realistic goals to achieve.
(Spreng et al, 1995)
Customer retention is directly linked with the customer satisfaction. The framework guide managers to decide which part of customer satisfaction has more collision, which part of customer satisfaction needs to be improve and make strategies to retain existing customers.
An individual level model of loyalty and customer retention has been developed, that can be used to predict effects of service level improvement at supermarket.
“Customer satisfaction has been changed recently from transactional marketing to relationship marketing”.
(Grönroos, Sheth and Parvatiyar, 1994)
“To all marketing activities directed toward establishing, developing, and maintaining successful relational exchanges”
(Morgan and Hunt, 1994)
“Customer satisfaction has been treated as essential instrument for the customer retention has gained significant importance in relational marketing approaches”.
(Rust and Zahorik, 1993)
Kotler sums this up when he states:
“The key to customer retention is customer satisfaction”
“The assumption that satisfaction/dissatisfaction meaningfully influences repurchase behaviour underlies most of the research in this area of inquiry”.
(Bloemer and Poiesz, 1989)
It is the continued repeat shopping with the supermarket, when customer retention is defined as customer stick to continuation of a business relationship with the firm. The later research has shown that relationship between satisfaction and retention has strongly focused on the customer satisfaction and behaviour. Customer retention is a key driver of firm profitability as well that it has shown in the previous research.
Our investigation suggest that recommend intention does provide way of customer future recommended behaviour. It recommends that recommended intention would not be enough as a forecaster of future customer loyalty and retention behaviour.
“Customer dissatisfaction has to diminish as organisation customer base; require the firm to rely on a more volatile customer mix; and erode the firm`s reputation”
(Levesque and McDougall, 1996)
It is very common practice to have some customers who are not very satisfied with the supermarket and their relationship. Dissatisfied customers are not always very loyal with the supermarket. Loyal customers are always not very satisfied as their behaviour patterns change. Dissatisfied customer do not always complain to the supermarket, but, com customers do complain to the service provider. Eventually, we see supermarket get the customer retention.
Supermarket could enhance the service level quality by using new and innovative technology such as self service checkout system (SSC). Self service checkout system machine is a very new phenomenon in the retail sector. But, it has increased the level of customer satisfaction and loyalty. Self service checkout system is very useful to enhance privacy and improve service. World is changing at rapid pace, supermarket needs to adapt with the customers want and needs. Customers like to use the self service checkout system for faster checkout shopping. It has helped organisation to retain the customer satisfaction and loyalty.
(Anderson, J 2007)
According to Jones and Sasser (1995), “customer satisfaction that generates more loyal customer to the organisations will achieve its goals very quickly”. Complete customer satisfaction is the key to secure customer loyalty and generate greater long-term financial performance. It is also clear that high customer satisfaction leads to the increase of relationship between customers and company. Furthermore, customer satisfaction is an important factor in the development process of the construction and the customer relationship.
Customer satisfaction has been considered in the following parts by Yi, 1993:
* Satisfaction with products
* Satisfaction with a purchase decision making
* Satisfaction with a performance quality
* Satisfaction with consumption experience
* Satisfaction with store or institution
* Satisfaction with pre-purchase experience
Consumer Needs - understanding their needs and their expectations what they want in terms of quality. Currently, more people wish to pay less and get the high quality products and loyalty meets their needs and maintains their satisfaction.
The 3Cs are:
* Cost to Satisfy Needs - gaining customer satisfaction doesn't have to be expensive. Having a reasonable price on the products
* Convenience - being liable to your customers will allow them to influence their concerns. Giving information about the products how does it works
* Communication - Customer's feedback is very important for solving any problem relation customer satisfaction, retention and self service checkout system.
The importance of the propose model of repurchase intention that is related to not exactly the same with the loyalty concept. Customer shows their loyalty in different ways and there is no one agreed definition for the loyalty.
In the competitive market, companies are facing new challenges of customer relationship management and their relationship with the organization. Companies try to achieve excellent customer services at minimum cost. Companies try to strengthen the relationship with their customers. Customer retention increase by two percent can also lead to profitability and it eventually increases the level of customer satisfaction. There are many factors that drive the customer retention and satisfaction. We need to find out the main drivers of the customer satisfaction, secondly, customer perception of expectation of service quality as compare to their competitors. Thirdly, company need to analyze the investing opportunities that can increase the customer satisfaction level and result into more customer loyalty and retention, lastly, supermarket need to adapt with the ever changing customer needs and demands.
Supermarket takes their customers very seriously because of their loyalty to the supermarket and to get repurchase advantages. To measure the satisfaction level, supermarket use different type of surveys and use different kind of questionnaires to get the feedback from the customers. Every company has a feedback system in place to find out about the customer wants and needs. 4p`s product model can be used to get the assessment of the purchase and buying behaviour pattern. Not every supermarket has assessed the value of customer feedback and their perceived level of satisfaction. There is very little chance of the possible knowledge of customer behaviour pattern. Customer satisfaction measurement procedures should be used to assess the level of satisfaction and retention and later, should improve the quality of service and products. Customer services can be improved by the measurement and assessment and should reduce the possible gap between actual performance and perceived performance.
(Jamieson, D 1994)
Health & safety policy and risk assessment by the employer:
Health and safety policy is very important for any supermarket and it s operation. Especially when dealing with self service checkout systems one should be aware with the health and safety procedures and processes. It is very important to consider such risk and precaution assessment to protect health and safety of employees and customers. Risk assessment is very important factor in any workplace. When these self service checkout systems are designed, health and safety measures are assessed and monitored to protect any threats and injuries of the customers and employees. (HSW Act)
Interface between computer and operator/user
In design, selecting, task and modifying software (self service checkout system), and in designing everyday jobs using display screen kit, the employer shall take into account the following principles:
Software (self service checkout system) must be appropriate for the task;
Software (self service checkout) must be simple to use and, where suitable, adaptable to the user's level of information or experience; no quantitative or qualitative checking provision may be used without the awareness of the operators or users;
Systems must give feedback to operators or users on the presentation of those systems;
Systems must show information in a set-up and at a pace modified to operators or users;
The values of software ergonomics must be practical, in particular to human information processing. (Source: health and safety executives' website)
Organizational health and safety responsibilities
There are many other responsibilities imposed by each organization`s health and safety policy. Organization provides an understanding of how health and safety responsibilities and accountabilities are integrated within the overall organization. In any organization, everyone has its own responsibilities and accountabilities such as Employer Responsibilities, Employees Responsibilities and Directors and Managers Responsibilities.
(Health & Safety at Work Act)
This research paper introduce its reader to the new and innovative technology self service checkout system and its effect on the customer satisfaction and after achieving required level of customer satisfaction; supermarket could gain the loyalty of their customers and retain the customers. As a result of this customer loyalty and retention, supermarket could gain sales profit or business success over their competitors.
(Gary, W. and Loveman, 1998)
Researcher will use the inductive method to collect primary data using exploratory approach by using designed questionnaires to collect the data about the customer satisfaction level at the self service checkout system. Researcher will also do the self observation and interviews to collect further information to refine his/her research objectives or theory.
The benefit of the customer retention and satisfaction has been classified by using the repeat purchase intention, and price tolerance. So that the purpose to use the customers management strategy that is the based on managing both satisfaction and benefit of customer retention.
(Narayandas, D. 1998)
The consumer should be involved in some way or another at most stages in the introduction of self-service checkout system. Every retail or sales companies should take care of customer wants and needs.
(Wright, R. 2006)
“If organizations want to consider total customer experience, satisfaction by itself is a weak measurement.”
(Barlow and Maul, 2000)
The literature in retailing and customer behaviour has identified commitment as one's “motivation” to keep a relationship with the retailer.
(Bendapudi and Berry, 1997 and Fournier, 1998)
Critical evaluation and research gaps:
As searching for the relevant literature directly related to self service checkout system, It was very amazed to find out that there was not any specific book written on the self service checkout system. Therefore, we can conclude that there is a major research gap in the field of self service checkout system and directly related books and materials.
There is not much material or relevant data available in the Libraries. There is not any relevant data available on the Internet as well. We can conclude that there is vast scope of research in this field and more work needs to be done. This makes my proposed research questions more relevant for the research work and it would add to the body of knowledge of the self service checkout system. But, on the other hand, customer satisfaction and customer retention topics do have some nice literature available to read and include in my research work. In this research paper, we will see the customer satisfaction theory by the Prof. Kano that explains about the different possible conditions of customer satisfaction and factors who affect them. Once any organisation achieves the customer satisfaction level, then, we can say that particular organisation or supermarket has competitive advantage over its rivals because of their customer satisfaction and customer retention as a result of it. Customer retention further adds to the business success and make sale profit for any organisation. In the time of Globalization, everything is changing. Every company needs to adapt to this change by introducing new and innovative technology such as Self service checkout system (SSC). We did investigate our customer behaviour by using Porter model of Value Chain analysis to analyse the customer value creation and their perception.
Stabell and Fjeldstad (1998) however have investigated the application of the value chain model to a variety of industries and have experienced problems in applying the value chain frame work to more than two-dozen firms.
They have found that the value chain is suitable for describing and understanding the value creation logic of manufacturing firms, but that it proves problematic when analyzing activities in service industry firms.
We can summarise that self service checkout system is a feasible topic for the proposed research work. And there is more roam to investigate more on this topic and more literature and books need to be written. Customer satisfaction and customer retention are very important factors to consider for any organisation to gain the profit in the long run. We have used different theories to further elaborate our proposed research questions or objectives such as Kano Model of Customer Satisfaction, Porter value chain model, customer satisfaction theories and customer retention as a result of customer satisfaction. We would like to investigate the customer satisfaction against the self service checkout system and user friendliness of this new machine. We would like to investigate the proposed questions by using primary data collection technique using inductive approach. Researcher has designed questionnaires to collect the information about the customer satisfaction level and self observation of the self service checkout system. In conclusion, we can try to achieve the solution to our propose questions or objectives to refine the customer satisfaction and profitability.
This chapter will introduce you to some general research approaches and philosophies to more specific method and philosophy to our research topic. Researcher would like to use the qualitative method to explore the research problem with the induction philosophy by using research questionnaires and self observation. After planning for selected research methodology, researcher would like to solve the research problems.
This chapter examines inductive approach as it relates to self-service checkout system, considers a variety of plan methodology that could have been used for this research, identifies and justifies a propose method of choice, and discusses methods of information collection for the work. The research for this learning relates to collecting data and observation regarding customer satisfaction and customer retention. As a consequence the researcher completes an aware decision to move towards the theory from an inductive position, and the qualitative method will be used to shape the approach to the theory formation, and then the data analysis.
The main research problem of this research paper is to improve customer's satisfaction and investigate changes come into play by SSC (Self service checkout) System in relation to the customers shopping experience. Secondly, Customer satisfaction is defined as the result of a complex, emotional process. The customer compares his experience following the use of product or services, the actual performance, with his expectation, wishes, individual norms or other standards of comparison before using the product. If the expected performance is met, or even surpassed, the customer experiences satisfaction (Simon and Homburg, 1998). Research second major problem is to see the user-friendliness of these SSC (Self service checkout) systems in relation to the performance and customer's services support at self service checkout systems. In addition, I also like to check the Health and safety procedures, Policies, wheelchair access to these SSC (Self service checkout) systems and waiting time at these checkout systems. Lastly, I would like to use SSC (Self service checkout) system to analyze the directly relationship to the customer satisfaction and policies and procedures to retain customers.
Self Service Checkout system (SSC) in Supermarkets, Customer satisfaction & retention
My research project will involve the use of inductive qualitative approach of using Questionnaires to collect data, although it will usually be made explicit in my presentation of the findings and conclusion. This is whether my research should use the inductive approach, in which I would gather the data and make theory as an effect of my data analyses. It will move from specific to general theory. On the other hand, Quantitative methods mainly involve of collecting data and change data into numerical form to present certain result of research findings and owes to positivism. But, Qualitative approach collect data in narrative way to analyse the trends and behaviour of concerned research problem. It involves vast amount of narrative data collection, analysis and presented in the customer behaviour trend or pattern, rather than in the numeric form in the case of quantitative approach. Qualitative approach suits more to above mentioned self service checkout system, customer satisfaction and customer retention that involve in depth data analysis of changing customer behaviour and trends. (Saunders, M. Lewis, P. and Thorn hill, A., 2009).
Deductive theory owes more to positivism and it involves you to make the hypothesis and theory, you make a researchable plan that needs to be tested later. This type of research is mostly preferable in social sciences, where hypothesis make the basis of explanation, explain the hypothesis in an operational terms. Testing those hypothesis findings, if need to investigate more or not. After hypothesis findings, we could update the theory findings and result.
(Collis and Hussey, 2003)
Deduction owes to positivism and it is more natural way of findings facts and s. When we make hypothesis, we compare to variables and their interaction and relationship together and there is a hypothesis that in summer, sales of ice cream goes upward as well as social unrest would increase. These two variables go upward in the same direction, but, there is not any relational interaction between these two variables. We adopt the deduction approach to make hypothesis to find out about the reason about these variables are going upward in summer. After doing the testing of our hypothesis, we could conclude that there is a third variable `summer` which is controlling these two variables.
(Bryman, A. and Bell, E., 2007)
Deductive theory is mostly related with quantitative research technique. It involves making a theory or hypothesis to further investigate and findings about the possible theory formation in the empirical investigation deductive process. Deduction approach uses scientific approaches. It moves from hypothesis to data collection and findings.
It is a highly structured approach that is more concern with the validity and clarity of the data. In the end of the research, researcher needs to generalise the research findings and ideas to make its case, and, to do this, researcher needs to use extensive sample size or large amount of dataset to analyse and generalise the research findings and hypothesis.
(Saunders, M. Lewis, P. and Thorn hill, A., 2009)
Inductive approach starts by data collection, research findings and analysing those findings to make or reach a theory. Inductive approach uses qualitative method that uses more specific sample size for data collection and analysis than extensive dataset and large data collection sample size to use in deductive approach. An alternative approach to conducting research on supermarket store employees would be to go on to the shop floor and interview a sample of the employees and their supervisors about the experience of working at the store. Research using an inductive approach is related with qualitative research technique. Qualitative method uses different data gathering methods and techniques to make hypothesis or theory about the proposed research problem.
(Easterby-Smith el at, 2008)
Qualitative research approach asks for more open question than closed question in deduction approach. Qualitative approach likes to find out about the lack of satisfaction level in any supermarket employees. Qualitative method adopts to gather data by using secondary sources, but, mainly uses primary data techniques using interviews, surveys, observation and using questionnaires etc. It is more flexible way of doing research to find out about the research findings and facts and progresses as the actual research work. Qualitative method uses whole research context and a realisation of researcher part of the actual research. It is less concern with the idea generalization. Mostly researchers are adopting qualitative approach as a research finding as it deals with the exploratory of the research problem realistically.
(Saunders, M. Lewis, P. and Thorn hill, A., 2009)
Purpose of your research:
Researcher thinks about my research project in terms of the questions that he wishes to answers and research objectives. Researcher studied through different research approaches to choose from such as exploratory study, Descriptive study and Explanatory studies etc. Researcher decides which researcher philosophy to use depends upon the area of research problem or hypothesis.
If researcher needs to explore the problem that has not been explore it enough before, then, researcher will use the Exploratory or explanatory studies, but, if the research study only involves finding out the existing facts and s, then, Descriptive study would be more feasible to use it. We would see in details about the each of these studies in section below.
In this design of research, the researcher tries to sort out an unclear dilemma which needs more time to be solved. Exploratory research design is significant as it is proven successful. In this kind of research most of the times the researcher is utilizing the secondary research findings and literature reviews with qualitative approaches in informal way dialogues with consumers and managers. In this dissertation, the questionnaire has been simplified and the researcher's efforts have been focused to make the questions for the manager and customers as much easy and straightforward as possible. Though it is difficult to find someone responsive to the questionnaire in the marketplace, the researcher has highly tried to do his level best in the case of informal as well as formal interviews and discussion both with the customers and the manager.
In descriptive method the objective of researcher is to represent the particular reports of individuals, occasions and events. It is also called as follower of exploratory method of research. In this method it is extremely significant to have already a piece of research done by others which will help to make an efficient process of data gathering for the particular research. In this dissertation descriptive research method is used by which the researcher is trying to discover the s for each segment of customers to make the progress of findings easier and precise.
In explanatory method which occurs following to descriptive research, the connection of unlike variables regarding the study or research is prepared. This method has a broad analytical and critical view to the collected data after the processes
Explanatory research as it is clear from the name of this method (explanatory); it describes and studies the posture and manner of events. E.g. solutions are lack of motivation in workplace, resolution for customer's dissatisfaction reducing the rate of absenteeism of the employees etc.
(Saunders et al 2006 p 130-155)
Design of the Research strategy
Research plan or strategy is a detailed plan of actions or working structure. Research plan consists of selecting different data collection methods and analysis. Researcher adopts research approach to do the research work and use the inductive approach. Researcher plans to investigate about the research problem by using different data collection method. Researcher needs to select main area of research strategy as to use primary or secondary research technique. Primary data collection consists of doing first hand research on the proposed question or problem. Secondary data can be defined as already existing dataset of Government documents, papers, websites and academic journals, research papers and books etc. Secondary research relates to quantitative method.
This method uses a large set of dataset for the analysing the data and it is very hard to make the sense out of other peoples work. On the other hand, primary data collection uses qualitative approach, it does not involve using extensive dataset. After doing research using anyone of the research philosophy, researcher makes sense of his/her findings and result and make theory or generalize the hypothesis to accept or reject the theory and if needed, update or revise the findings and results. In the below 4 describes that the
(Saunders et al 2009)
Experimental Research- Experiment is a form of research that owes to natural sciences researches than social sciences subjects.
Experimental research design is not suitable to use in business or management subject, but, you can use this in the psychology subject. The purpose of this study is to relate the casual association between variables. One variable changes could inherit into second dependent variable. Research design approach cannot be adopted by any organisation because no one likes to do experiment with their job or business. This experiment design is not suitable for using in our self service checkout system research project.
(Bryman,2008) Longitudinal Studies
This type of study analyse the change over time about data collected. This study involves doing research people or events over longer period of time such as recording of financial condition over time by World Bank and it has an extensive dataset to explore. Government organisations use this type of study for analysing the demographic behaviour of the population over time. One example can be university student satisfaction survey at the end of their studies.
Analysing those collected data over time for different batches of university students about their satisfaction level survey. Supermarket giants like TESCO and ASDA can use longitudinal studies over time to analyse their Human resource department and employee satisfaction level.
(Sanders et al 2009)
Survey designs- There are two forms of survey design:
Census- you collect and assemble data from every member of the organisation or the population.
Sample- sample can be defined as subset of the whole population. If researcher is doing research on the 1500 members of the population, then, it will be suitable for the researcher to have sample size of 150 or more people in studied sample research. Qualitative research uses less extensive sample size as it based upon primary data collection research, but, in the case of quantitative research, researcher uses extensive set of dataset. Sample size depends upon the chosen research methodology and philosophy. In my research of self service checkout systems, I will use the simple random sampling to qualitatively collect my data using questionnaires.
Sampling procedures fall into 2 categories
o Non probability sampling
o Probability sampling
Case studies- this type of study consist of study for one or small number of organisation or people in its context. Data can be collected of studied case over period of time relating to different elements and later, this collected data can be analysed and make case of problem and its solution.
(Robson, 2002) defines case study as “a planning for conducting research that will consist of empirical findings of a specific phenomenon with its context using different methods of findings”.
Case study can be done on the one particular or few elements. Case study is very important in getting insight of the organisation for the whole context. The case study strategy can be used to answers to those questions like `why`, `what` and `how` etc.
Case study strategy is mostly used in the explanatory and exploratory studies. It involves digging down deeply to find out about insight answers to proposed hypothesis. In case study, different data collection methods can be used to get the insight story about the research case using such as Interviews, Observations, Surveys and Questionnaires.
Case study strategy can be used to collect time period data in the supermarket employee satisfaction survey.
In this study, we use different data collection techniques with in one case study to authenticate or validate the reliability of the data collected over time for the proposed research.
(Flick et al, 2007)
Over the years, researcher has adopted triangulation study because of its multi methods use of data collection methodologies.
He further states that it is also very valuable method of study what cross-check those collected data by using semi- structured or unstructured interviews with data gathering by questionnaires. It is very important for the validity and reliability of the data collected in qualitative method of data collection technique. In our example of supermarket, we can do cross-sectional check on collected data of questionnaires against data collected by semi-structured interviews by the researcher in the supermarket, to check the validity and reliability of data collected and does it makes sense to its proposed purpose?
“Action research is purely a type of self-reflective question undertaken by participants in common situations in order to improve the rationality and justice of their own practices, their thoughtful of these practices, and the situations in which the practices are carried out “
(Carr and Kemmis 1986: 162)
Action research process consists of taking measures and actions to improve performance or correct research problem. People inside the organisation take action to eradicate or improve the concerned problem. Self service checkout system project can be taken as action research project as it would improve the customer satisfaction and retention of the supermarket. As I am working in Supermarket can help the supermarket to improve customer satisfaction and retention by using action research approach.
“The researcher goes by feel and intuition, aiming to produce common or contradictory themes and pattern from the data which can be used as a basic for interpretation”
(Easter-Smith et al 1991)
Ground theory moves from specific to more general. It is a complex way of doing research and it is very similar to action research. In this process, data of corpus need to be used to reach some common ground. It is an inductive way of doing research.
It involves the process of comparison of rich textual data sources, interviews databases and going through memos and historical data. Ground theory is a complex process to conduct a research but it gives definite theory for one specific data set of the whole database.
Secondary Data Analysis
This consists of extracting and analysing already available data in the form of large databases of Government articles, papers, announcements and websites, Academic journals, research papers, books and unpublished research work and consultancy publications etc.
Secondary data deals with quantitative method of data collection and it is very hard to make sense of your contribution of research if your research project involves only quantitative method of research analysis and findings. Researchers use large set of databases to subset their relevant information for analysis and presentation for the research problem. In our supermarket research, we will use secondary as well as primary data to make sense of data collection by using relevant supermarket annual financial reports and employees surveys reports.
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