The role of etail quality, e-satisfaction and e-trust in online loyaltydevelopment process
Jiyoung Kim
a,
Ã
,1
, Byoungho Jin
b
, Jane L. Swinney
b
a
Department of Consumer Sciences, College of Education and Human Ecology, The Ohio State University, Columbus, OH 43210, USA
b
Department of Design, Housing, and Merchandising, College of Human Environmental Sciences, Oklahoma State University, Stillwater, OK 74078, USA
a r t i c l e i n f o
Keywords:
E-commerceE-trustE-loyaltyE-satisfactionEtail quality
a b s t r a c t
The purpose of this study is to propose and test an integrative model of e-loyalty development processby conceptualizing that e-loyalty is influenced by e-satisfaction, e-trust and multi-dimensional aspectsof etail quality. In order to capture the full picture of etail quality, we attempt to cover the completepurchase experience by focusing on four dimensions of etail quality that go beyond websitefunctionality or system quality aspects: fulfillment/reliability, website design, security/privacy andresponsiveness. From the 182 usable data obtained, hypotheses are tested using structural equationmodeling. The results indicate that the e-loyalty development process is influenced by both e-satisfaction and e-trust. The relationship between e-trust and e-satisfaction is found to be significant aswell. Components of etail quality have differing effects on e-satisfaction and e-trust. Evaluation of fulfillment/reliability influences e-satisfaction as well as e-trust. Website design positively influences e-satisfactionwhile security/privacy has a positive effect on e-trust. However, contrary to our expectation,responsiveness affects neither e-satisfaction nore-trust. Managerial implications are provided followingpresentation of the findings.
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2008 Elsevier Ltd. All rights reserved.
The importance of loyalty has been a critical issue in the studyof online retailing (Park and Kim, 2003;Yang and Peterson, 2004).
E-loyalty is widely defined as customer’s favorable attitude andcommitment towards the online retailer that results in repeatpurchase behavior (Srinivasan et al., 2002). As a result, e-loyalcustomers bring increased profitability to the online retailerthrough long-time customer commitment and reduced costs of acquiring new customers (Reichheld et al., 2000). E-loyalcustomers are not the ones seeking the lowest prices, but theones willing to pay premium prices. They also tend to refer newcustomers to the online retailer, providing rich potential sourcesof profit (Reichheld et al., 2000). Further, e-loyal customerspurchase more than newly acquired customers and can be servedwith reduced operating costs (van Riel et al., 2001). Therefore,even though the cost of establishing online loyalty is larger thanthat of traditional brick-and-mortar retailers, profit growthaccelerates at an even faster rate once the relationship has beenbuilt(Reichheldand Schefter, 2000). These previousfindings pointto the need for understanding how e-loyalty is developed.In explaining the establishmentof e-loyalty, both e-satisfaction(e.g.,Anderson and Srinivasan, 2003) and e-trust (e.g.,Reichheld
and Schefter, 2000) are found to play a pivotal role. Forexample, studies discovered that e-satisfaction and e-trustinfluence e-loyalty either individually, such as e-satisfaction
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e-satisfaction
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e-loyalty (Gummerus et al., 2004).However, despite the proven importance of e-satisfaction ande-trust on e-loyalty, the study of their antecedents has only beenpartially understood in the e-loyalty development process. Thisstudy strengthens the literature by adding different componentsof etail quality as a possible critical antecedent in the model of e-loyalty development and attempts to build a stronger holisticmodel by including etail quality.In the present study, etail quality is measured ‘‘from thebeginning to the end of transaction, including information search,website navigation, ordering, interactions, delivery and satisfac-tion with the ordered product’’ (Wolfinbarger and Gilly, 2003,p. 183). This concept of etail quality includes aspects of bothonline transaction and offline fulfillment which have not beenfully investigated in prior studies. In an online retailing context,consumers base their repurchase decisions on complex evalua-tions of the full service offer (Gronroos et al., 2000;Porter, 2001).
ARTICLE IN PRESS
Journal of Retailing and Consumer Services
0969-6989/$-see front matter
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Corresponding author at: School of Merchandising & Hospitality Management,P.O. Box 311100, Denton, TX 76203-1100, USA. Tel.: +19405654348;fax: +19405653263.
E-mail addresses:
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She will join the University of North Texas as an Assistant Professor fromAugust 25, 2008 Journal of Retailing and Consumer Services
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Please cite this article as: Kim, J., et al., The role of etail quality, e-satisfaction and e-trust in online loyalty development process. Journal of Retailing and Consumer Services (2009), doi:10.1016/j.jretconser.2008.11.019
Most transactions initiated online are completed offline. Never-theless, previous research neglected the unique complementaryroles of website performance and offline fulfillment in theempirical studies of e-loyalty development process (Wolfinbargerand Gilly, 2003). For example, previous studies have primarilyfocused on website design (Kim et al., 2007), interaction of theconsumer with the website (Loiacono et al., 2002;Yoo and
Donthu, 2001), service quality (Devaraj et al., 2002;Montoya-
Weiss et al., 2003;van Riel et al., 2001), system quality (Rodgers
et al., 2005), or website display (Konradt et al., 2003). While these
studies provide a framework of assessing etail quality, they havefailed to recognize that etail quality is more than how a consumerinteracts with a website (Collier and Bienstock, 2006;Semeijn
et al., 2005).Furthermore, the current study proposes etail quality as amulti-dimensional construct (Wolfinbarger and Gilly, 2003),investigating the distinct role of each etail quality dimension inthe e-loyalty development process. We adopted four dimensionsof etail quality suggested byWolfinbarger and Gilly (2003):fulfillment/reliability, website design, security/privacy, and cus-tomer service. While a recent study tested a comprehensivemodel of e-loyalty development process incorporating severalantecedents such as service quality, perceived value, trust, andsatisfaction (Harris and Goode, 2004), the study used servicequality as a single etail quality dimension; thus provided limitedmarketing implications. By measuring the importance and effectof each of the four dimensions of etail quality in explaining e-loyalty development, this study can provide more developedunderstandings of the role of etail quality within the model.The purpose of this study is to propose and test a model of thee-loyalty development process for online retailers, incorporatingetail quality, e-satisfaction, and e-trust. This research focuses onconsumers’ attitude and behavior towards retailers operatingonline, not a brand or manufacturer. Within the model, wemaintain that distinct aspects of etail quality have a differingimpact on enhancing consumer e-trust and e-satisfaction, which,in turn, lead to customer e-loyalty. This article begins with theproposed model and the hypotheses. We then describe theresearch design, the methodology, present our results andconclude with discussion, managerial implications and limita-tions, and suggestions for future research.
1. A proposed model of e-loyalty development process
Our proposed model presents e-loyalty as influenced by directand indirect relationships among e-satisfaction, e-trust, and etailquality. We will present our hypotheses through first explaining(1) the relationships among e-loyalty, e-satisfaction, and e-trustand (2) the influence of the four dimensions of etail quality on e-satisfaction and e-trust. The proposed model is outlined inFig. 1.
1.1. E-trust and e-satisfaction as antecedents of e-loyalty
Loyalty is defined as the repeated purchase behavior presentedover a period of time driven by a favorable attitude toward thesubject (Keller, 1993), including both attitudinal and behavioralaspects. This combined conceptualization of loyalty is stronglyargued byJacoby and Chestnut (1978), who criticized thebehavioral aspect of loyalty research which focused merely onrepeat purchasing. Repeat purchase behavior only reflects theoutcome of a decision process in which the emotional, attitudinalfacet of loyalty is disregarded. A true loyal customer was found tohave commitment and attachment towards the retailer, and is noteasily distracted to a slightly more attractive alternative (Shankaret al., 2003). True loyalty indicates higher purchase intention,resistance to switch and willingness to pay more (Shankar et al.,2003).Loyalty of the customers toward the exchange party generallyencompasses brand loyalty (for a brand name product), vendorloyalty (for industrial goods), service loyalty (for services), andretailer loyalty (for a retailer/store) (Lim and Razzaque, 1997).Retailer loyalty, the loyalty towards a specific retailer, is of extreme interest to merchants, because high customer acquisitioncosts are difficult to regain without the commitment and repeatpurchasing of the customer (Wallace et al., 2004). In the currentinvestigation, we focus on retailer loyalty in the online retailingcontext. For this study, e-loyalty is defined as a customer’sfavorable attitude and commitment towards the online retailerthat results in repeat purchase behavior, based on the study of Srinivasan et al. (2002).Trust has been conceptualized as ‘‘customer confidence in thequality and reliability of the service offered’’ (Gabarino and Johnson,1999, p.71) and has been presented as a central attributein relationship initiation, formation and maintenance in a varietyof exchange contexts (Sirdeshmukh et al., 2002;Verhoef et al.,
2002). Previous studies suggest that trust has a significant impacton the establishment of loyalty in both offline (Chaudhuri andHolbrook, 2001;Singh and Sirdeshmukh, 2000;Sirdeshmukh et
al., 2002) and online (Park and Kim, 2003;Pitta et al., 2006,
Reichheld et al., 2000). It is found that trust, not price, isconsidered as the most important factor for customers in decidingto consolidate their purchases with one online retailer (Reichheldet al., 2000).Reichheld and Schefter (2000)assert that ‘‘togain the
loyalty of customers, you must first gain their trust. That’s alwaysbeen the case but on the web
y
it’s truer than ever’’ (p. 107),
ARTICLE IN PRESS
H3H9H8H4H5H1H2Fulfillment/ReliabilitySecurity/PrivacyResponsive-nessWebsiteDesignE-loyaltyEtailQualityE-satisfactionE-trustH6H7
Fig. 1.
The proposed model of the e-loyalty development process.
J. Kim et al. / Journal of Retailing and Consumer Services
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Please cite this article as: Kim, J., et al., The role of etail quality, e-satisfaction and e-trust in online loyalty development process. Journal of Retailing and Consumer Services (2009), doi:10.1016/j.jretconser.2008.11.019
emphasizing the importance of e-trust in e-loyalty development.Therefore, we hypothesize that:
H1.
E-trust has a positive effect on e-loyalty.In addition, we expect e-trust to not only have a direct impacton e-loyalty but also to have an indirect influence throughe-satisfaction. Trust is a critical antecedent of building relation-ships between buyer and seller (Sirdeshmukh et al., 2002;Verhoef
et al., 2002). In any buyer–seller relationship, consumers’ trustevaluations before a specific exchange episode is found to have adirect influence on their post purchase satisfaction (Singh andSirdeshmukh, 2000). This relationship is deemed to hold true inonline retailing contexts where trust may be a fundamentalcomponent for initiating the transaction. Customers perceive ahigher level of risk with online retailers than traditional retailersin terms of delivery, payment, information disclosure, etc. Thus,online customers may prefer to transact with online retailers theycan trust (Singh and Sirdeshmukh, 2000). In previous studies,trust is empirically found to be a strong predictorof satisfaction inonline settings (Gummerus et al., 2004;Harris and Goode, 2004;
Jin and Park, 2006). In line with the previous arguments, wepropose that trust should be established in order for thecustomers to be satisfied with the online retailer.
H2.
E-trust has a positive effect on e-satisfaction.Customer satisfaction is in the center of the firm’s relationshipprogrammes in the online retailing context (Winter, 2001).Satisfaction has been defined as the perception of pleasurablefulfillment in the customers’ transaction experiences (Oliver,1997). We conceptualize e-satisfaction as a cumulative construct,which is ‘‘based on the sum of satisfaction on each purchase andconsumption experience with a good or service over time’’(Anderson et al., 1994, p. 54). Satisfied customers tend to havehigher usage of service (Ram and Jung, 1991), possess strongerrepurchase intention, and are often eager to recommend theproduct or service to their acquaintances (Zeithaml et al., 1996)than those who are not satisfied. In addition, dissatisfiedcustomers are more likely to search for alternative informationand switch to another retailer, and is also more resistant todeveloping a close relationship with the retailer (Anderson andSrinivasan, 2003). In addition, the relationship between e-satisfaction and e-loyalty has been found to be significant innumerous studies (Anderson and Srinivasan, 2003;Cai and Xu,
2006;Park and Kim, 2003;Rodgers et al., 2005). Thus we propose:
H3.
E-satisfaction has a positive effect on e-loyalty.
1.2. Etail quality dimensions as antecedents of e-satisfaction and e-trust
The literature on online shopping suggests different scales forassessing etail quality, yet most of them exclusively focused onwebsite experience, such as website use and system quality (eSQ,Parasuraman et al., 2005), website design and interactivity(WebQual, Loiacono et al., 2002), or website interface and onlineprocessing (SITEQUAL,Yoo and Donthu, 2001). However, etailQ developed byWolfinbarger and Gilly (2003)suggest that whenconsumers transact with online retailers, they evaluate not onlywhat products/services the website offers, but also how theirneeds are fulfilled through offline support, such as orderfulfillment and delivery. This measure, etailQ, well suits ourintention to capture the holistic view of e-loyalty developmentprocess, taking the online retailers’ offline fulfillment intoconsideration. Through extensive multi-group study in the scaledevelopment process,Wolfinbarger and Gilly (2003)propose fourdimensions of etailQ: fulfillment/reliability, customer service,website design, and privacy/security. EtailQ is arguably the firstpsychometrically robust instrument that focus specifically ononline quality, and is proved to generalize across different productcategories and cultures (Caruana and Ewing, 2006). In the study,instead of using the term ‘customer service’ for the secondconstruct, the researcher chose to use the term ‘responsiveness’ todescribe the construct. Wolfinbarger and Gilly defines customerservice as responsive, helpful, and willing service that responds tocustomer inquiries quickly. However, customer service, the termitself might imply a broader concept to many of the researchersthan what it actually assesses in etailQ. In online retailingliterature, customer service has been defined as broadly as overallcustomer evaluations and judgments regarding the excellence andquality of e-service delivery in the virtual marketplace (Santos,2003). In specifically describing online retailers’ prompt responseto customer inquiries and information request, some researchersused ‘responsiveness’ as a label (Parasuraman et al., 1988;Yang,
2001;Kim and Lee, 2002). Even though the term ‘responsiveness’
is included in another measure for online service quality,SERVQUAL, this study will adopt the term in order to betterdescribe the construct the research attempts to assess and avoidconfusion.We hypothesize that fulfillment/reliability and customerservice will have a positive impact on both e-trust ande-satisfaction dimensions. In addition, website design is hypothe-sized to affect e-satisfaction while security/privacy dimension isproposed to influence e-trust. The following details the rationalefor each relationship.Fulfillment/reliability is explained as the delivery of the rightproduct within the time frame promised with accurate productinformation displayed on the website so that customers receivewhat they expect to receive (Wolfinbarger and Gilly, 2003). Whileit is a convenient method of shopping, consumers need to wait acouple of days until they can actually have the product in theirhands when shopping online. Therefore, handling and shipping of the products have been challenging to online retailers. One of thereasons that Amazon.com started off selling books online isbecause books are fairly easy to handle and ship (Rabinovich andBailey, 2003). In investigating the relationship between fulfill-ment/reliability and e-trust, studies have shown that consumersare especially concerned about order fulfillment when buildingtrust with an online retailer (Reynolds, 2000). Trust concerns thenotion of competence that includes fulfilling the promised servicein a reliable and honest manner (Singh and Sirdeshmukh, 2000).Therefore, delivering the promises and fulfilling customers’ belief towards the product/service information presented should be anecessary condition in generating customer trust (Reichheld et al.,2000;Urban et al., 2000). In line with the argument, we propose
that customer e-trust is earned by delivering the right product atthe right time and meeting customer expectation on productquality as promised by the retailer.
H4.
Fulfillment/reliability has a positive effect on e-trust.Offline fulfillment/reliability is found to affect customer e-satisfaction as well (Semeijn et al., 2005;Trabold et al., 2006).
Focusing on the outcome quality of the service,Collier andBienstock (2006)suggest that receiving the product in theexpected time frame, getting the exact product customersordered, and receiving the product in a promised condition affectthe level of e-satisfaction. Study result of Wolfinbarger and Gilly(2003)indicated that fulfillment/reliability was the most salientfactor in judging customer e-satisfaction level compared to otheretail quality dimensions. Therefore, we hypothesize that fulfill-ment/reliability of the online retailer will positively affectcustomer e-satisfaction.
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J. Kim et al. / Journal of Retailing and Consumer Services
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Please cite this article as: Kim, J., et al., The role of etail quality, e-satisfaction and e-trust in online loyalty development process. Journal of Retailing and Consumer Services (2009), doi:10.1016/j.jretconser.2008.11.019
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The Role of Etail Quality
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