Impact of after sale services on

Customer loyalty

Submitted To:
Prof. Kashif Mahmood

Submitted By:
Hassan Faisal
B.B.A Marketing
Roll#11598
Session 2010-14

Acknowledgement
In the name of Almighty Allah the most merciful and the most gracious who helps me a lot to
complete my thesis work for the completion my bachelor’s degree of business administration.
My special thanks to the supervisor Prof. Kashif Mahmood for his continues support and
guideline throughout my thesis work. His experience in the field of research teaches me a lot. I
also would like to say thanks to chair person of university Dr. Abdul Rehman for providing me
the opportunity of learning. I would like to pay special thanks to my parents and my friend who
helps me a lot to complete and finalize my thesis till the end.

Statement of originality

I hereby, declare that to be the best of my knowledge the work presented in this
thesis is original and this work is done by myself and not submitted to this or
another university.

Signed:
Date:

Table of Contents
Abstract:........................................................................................................................ 7
Chapter # 01: Introduction & Background..............................................................................8
Background:................................................................................................................ 8
Research Gap:.............................................................................................................. 9
Rationale:................................................................................................................... 9
Statement of the problem:............................................................................................. 10
Research Aim:........................................................................................................... 10
Objective:................................................................................................................. 10
Purpose Statement:...................................................................................................... 10
Research Question:..................................................................................................... 11
Significance of the study:.............................................................................................. 11
Hypotheses:.............................................................................................................. 11
Chapter # 02: Literature Review:........................................................................................ 13
Chapter # 03: Methodology:............................................................................................. 20
Research Philosophy:................................................................................................... 20
Positivism:............................................................................................................. 20
Interpretivism:........................................................................................................ 20
Pragmatism:........................................................................................................... 20
The Research paradigm taken:.................................................................................... 21
Research Approaches:.................................................................................................. 21
Induction:.............................................................................................................. 21
Deduction:............................................................................................................. 21
Qualitative Approach:............................................................................................... 21
Quantitative Approach:............................................................................................. 22
Research Approach Taken:......................................................................................... 22
Research Design:........................................................................................................ 22
Data Collection:......................................................................................................... 23
Primary Data:......................................................................................................... 23
Secondary data:....................................................................................................... 24
Sampling Technique and sample:................................................................................. 24

Treatment of Data:...................................................................................................... 24
Ethical consideration:.................................................................................................. 25
Chapter #4: Analysis................................................................................................ 26
Regression Analysis:....................................................................................................... 37
Chapter No.5:Discussion and Conclusion............................................................................. 40
References:.................................................................................................................. 45

Abstract:
This study examines the impact of after sale service character and its role on
customer loyalty in the home appliances sector of Pakistan. The elements of after
sale service are warranty and delivery is involved to check the impact on customer
loyalty. In this globalized market the companies are trying to differentiate
themselves from their competitors. In the home appliances sector of Pakistan the
outlook of home appliances may differ but their functions are standard so in this
context the after sale service plays an important role in retaining the customer by
providing the add on services . After the detailed review of literature the researcher
found that after sale service plays a vital role to make the customer loyal. For this
purpose the primary data is also collected and quantitative techniques are used.
Descriptive and inferential statistics are also applied. This study will be helpful for
the researcher to explore it more from that point. And it is also benefited to the
managers of the home appliances companies that how the customer rate the after
sale service characteristics. Due to limitation in time my study is only focused in
the city of Lahore.
Keywords: Delivery, Warranty, Customer satisfaction, Customer loyalty

Chapter # 01: Introduction & Background
Background:
Company promises to a buyer for a product or service in the form of warranty
which is or shall be represented. It can be considered as a contractual agreement between the
buyer and seller. A service contract is that the latter in entered into voluntarily and is purchased
independently- the buyer may even a choice of terms, though a warranty is part of product
purchase and interlinked with sales (Anderson, & Jacobsen, 2000). Customer loyalty on the other
end is the outcome of a company’s creating advantage for the customers so that they will retain
and increasingly repeat business with the company (Anderson, & Jacobsen, 2000).
It is in fact an extremely said commitment of customers to give preference to a products or services of a
particular company in future in spite of situational restraints or promotional influences to root the
swapping behavior. Furthermore true customer loyalty is created when consumers become advocate of a
company without any incentive (Oliver, 1997).

In today’s dynamic corporate environment the importance of customer satisfaction is
understandable as it is highly influenced customer “repeat purchase intensions whereas
dissatisfaction has been seen as a key reason for customer intents to shift” (La Barbera, &
Mazursky, 1983). Loyal customers are most likely to share their experience of product with other
five or six people around them. Similarly dissatisfied customers are more likely to convey
another ten people about their unfortunate experience with a specific company’s product. In
order to realize customer satisfaction, companies must be capable to develop and sustain long
term relationships with customers through satisfying several customer needs and demands which
resultantly encourages them to carry on to do business with the company on on-going basis (La
Barbera, & Mazursky, 1983).
Business organizations organize activities by the name of after sales services after the purchasing
phase and it is the part of customer relationship management. After the product has been
delivered to the customer the service provided is after sales service (Vitasek, 2005). It was found
from the statistical results, that delivery, installation and warranty are to be significantly linked
with the customer satisfaction. All the above mentioned factors are the key elements in

delivering an acceptable after sales service performance that will be able to make the customer
satisfied and happy. The requirements of customers can be met by the delivery of the product at
the right place and right time with the reasonable price. Yet, companies often focused towards
their distribution channels, sometimes with harmful results (Kotler and Armstrong, 2010).
For that matter, many business organizations (including banks) that resorted to having greater
service quality have been establish to be market leaders in terms of sales and long lasting
customer loyalty and retention (Anderson and Sullivan, 1993; Boulding et al., 1993; Eklo¨ f and
Westlund, 2002).A business that satisfies their customer’s needs will be unsurprisingly attain the
loyalty of their customers, thus resulting in recurrence business as well as prospective
referrals.Loyal and satisfied employees greatly achieved loyal and satisfied customers (Heskett,
1994).
Research Gap:
Most of the studies are found about the customer satisfaction in the home
appliances sector of Pakistan so a gap has been identified that there is no study found on the
customer loyalty in that sector as the author recommend for the future study is that in future the
researcher may focus on the factors such as customer needs, customer loyalty, product
differentiation and price of product that enhance the customer satisfaction. Due to limited time
the

author

focus

on

characteristics

of

after

sale

service

that

affects

customer

satisfaction(Choudhary et al., Dec 2011)
Rationale:
The importance of this research is to identify the impact of after sales services on
customer loyalty to check whether customer rates the after sales services in the home appliances
sector of Pakistan. The home appliances are the shopping goods category so these items such as
refrigerator and air conditioner once buy are durable for the 5 to 10 years approximately. After
sale services gives the edge of security to the consumer to save their investment. The ultimate
purpose is identify the relationship of warranty and delivery service which are the element of
after sale service with customer loyalty to check whether customers are being loyal due to
warranty and delivery service. Often customers ask about the warranty while taking purchase
decisions. Sometime the customers leave that product of a specific company due to warranty
issues. This case is mostly faced by the multinational companies who just sale their product but
their customer care center does not exist.

Statement of the problem:
“TheImpact of after sales services on customer loyalty”
Research Aim:
The aim of writing the report is to identify the impact of after sale service on customer
satisfaction and to check the impact of customer satisfaction on customer loyalty. Today is the
era of CRM; companies are differentiating their selves on the basis of after sale service. There is
no significant difference in the product outlook and features of the home appliances product.
Mostly brands in the home appliances have the same design of their product although there is
little bit difference but the features are same as they are according to the customer needs. The
companies who are targeting the same market try to differentiate on the basis of after sale
service. In after sale service warranty and delivery of product are the important element. To
check and identify the importance and verify the literature studies the objective will be achieved.

Objective:
 Check the impact of independent variables on dependent variable
 Identify the role of customer satisfaction for customer loyalty
 Evaluate the results of variables to verify the theory
 Study the importance of after sale service in the mind of consumer
 Identify the customer satisfaction elements
Purpose Statement:
The purpose of this study is to find out the relationship of after sales
service with customer loyalty. In this study i find out that which variables in after sales service
have an impact on customer loyalty. For this i have select the delivery and warranty variables to
check the impact on customer loyalty. This era is of customer relationship management. Every
business organization tries to build and retain the customer loyalty. The loyalty of a customer is
the result of success of any business organization. To measure customer loyalty we study the role
warranty and delivery that there is any relationship between the after sales service variables and
customer loyalty. The customer is back bone of any business organization and today every
organization is competing for customer to gain the huge market share.

Research Question:
What is the impact of after sales services on customer loyalty?
Significance of the study:
The importance of the study is that to find out that how customer rate after
sales service. Which elements are important in after sales service which increase customer
satisfaction. Customer satisfaction matters a lot for every company. Today everyone is
calculating the profit in terms of customer not in terms of profit volume. Most of the companies
now a day try to build customer satisfaction to increase the number of customer because a
satisfied customer will become more satisfied when the company meets the requirements
according to the desired level. The significance of this study is that this study will be help out to
the managers in corporate world about taking decision which variables are important in the
perception of consumer. So that they will easily implement these variables in their after sales
service to meet the requirements of the customer; because today is the battle of customer
between companies. This study will also be helpful for the researchers to take information about
the variables so that it will help them to research furthermore and it will also helpful for the
students of marketing as it will increase their knowledge about the after sales service and they
will come to know the impact of warranty and delivery on customer loyalty. They will also come
to know that is there any relationship between warranty and customer loyalty? They will come to
know that how the delivery and warranty will increase customer satisfaction. This study also
contributes towards the policies for after sale service. The right policies of after sale service help
the company to retain their customer and the retention of customer in results increase customer
loyalty. The customer relationship manager in after sales service department will come to know
the role of warranty and delivery and help them to design the policies so that the ultimate
purpose of creating a separate department will be achieved by facilitating the needs of the
customer accordingly.
Hypotheses:
H1: There is significant relationship between warranty and customer satisfaction
H0: There is no significant relationship between warranty and customer satisfaction
H2: There is significant relationship between delivery and customer satisfaction

H0: There is no significant relationship between delivery and customer satisfaction
H3: There is significant relationship between customer satisfaction and customer loyalty
H0: There is no significant relationship between customer satisfaction and customer loyalty
H4:There is significant relationship between warranty and delivery.
H0:There is no significant relationship between warranty and delivery.
H5: There is a mediating relationship of customer satisfaction between warranty and customer
loyalty.
H0: There is no mediating relationship of customer satisfaction between warranty and customer
loyalty.
H6: There is a mediating relationship of customer satisfaction between delivery and customer
loyalty.
H0: There is no mediating relationship of customer satisfaction between delivery and customer
loyalty.

Chapter # 02: Literature Review:
After Sales Service:
After-sales service which is a part of consumer relationship management helps to boost a
customer’s loyalty(Shaharudin, Yusof, Elias, & Wan Mansor, 2009).Three most considerable
factors involved in after-sales service are delivery, installation and warranty. It can be seen that
consumers really rely on the prompt delivery of the goods, the installation response to be
according to design and condition, and with the assertion of good quality products that are
guaranteed for a certain period of time. When all these all three factors are being looked at
competently and proficiently, the repute of the company will be enhanced and this will make the
company much talked about among the customers and competitors. To the manufacturers, the
three factors in after-sales service are of utmost significance to build a long-term beneficial
relationship with the existing buyer. Such correlation will create a strong loyal customer base
that will give the company a bloodthirsty edge for upcoming endurance. It is essential that the
business to adopt a good after–sales service management to increase the effectiveness and
efficiency to serve up the customer(Shaharudin et al., 2009).
The brunt of after sales service on customer satisfaction and retention with exceptional reference
to LG Electronics in Nigeria, Practitioners and researchers agreed on a point that the after sales
service plays a most important role in gratifying customers as well as escalating number of firms
across industries. In this study it is found that after sales service indices product delivery,
installation and warranty were considerably independent and joint predictors of customer
satisfaction and retention. The study also revealed that customer rate warranty contract highest
among after sales service dimensions followed by delivery and installation(Isaac .O, S.A, & P.O,
Jul. - Aug. 2013).After-sales service has emerged as a most important starting place of
competitive manipulation, so firms endeavor for competitive advantages with their after-sales
service portfolio to make distinct offers from competitor(Goffin, 1999)(Asugman, 1997 #7).
(Asugman, Johnson, & McCullough, 1997) defined after sales service as those tricks in which a
firm engages after acquisition of its product that minimize possible problems related to product
usage, and maximize the worth of the consumption experience. (Chen & Hu, 2010)also agreed
that free basic after-sales service plays a significant role in attracting more buyer attention in a
market with brutal brand competition. Offering satisfactory after-sales service to customers has

become a most important generator of revenue, earnings, and competency in recent industries
(Cohen & Whang, 1997). (Shaharudin et al., 2009)studied the factors of after sales service,
which affects customer satisfaction in the electronic market of Malaysia. Three factors delivery,
installation and warranty were involved for the determination of the after sales service, a sample
of hundred people out of the population was survey through close ended questionnaire, and the
ordinary least square was used for analysis of the data to check the affect of the three factors on
after sales service. The result showed that warranty, delivery and installation have significant
impact on the buyer satisfaction and retention.
(Gupta & Lehmann, 2007)in their study finds that the impact of after sales service on customer
relationship and they found out that after-sales service is regarded as a significant factor that has
an impact on establishing good relationships with customers. (Cohen & Whang, 1997) all of
them understood that large number of extra after-sales service policies to consumers will lead to
customer satisfaction and retention as well as higher productivity. (Kumar & Kumar, 2004)said
that those firms who do not have plan for the delivery of product or service is same like that a
person who starts his/her journey without knowing the final destination.(Milgate,
2001)characterized the delivery of product by two dimensions i.e. speed and reliability. The
author also ensures that right product at the right time in right quantity from right source
delivered to the right person in a reasonable price. It is assumed that warranty is the obligation
of seller for a product; it is the job of a seller and it creates satisfaction in the mind of consumer
that the product he/ she buy will be long lasting(Udell & Anderson, 1968).An important element
of marketing new products is warranty as superior warranty signals advanced product quality and
provides better assurance to customers. Servicing warranty involves supplementary costs to the
manufacturer and this cost depends on product/service reliability and warranty conditions.
Product reliability is influenced by the decisions made during the blueprint and built-up of the
product. As such warranty is very imperative in the context of new products. Product warranty
has received the concentration of researchers from many different disciplines and the literature
on warranties is vast(Murthy & Djamaludin, 2002).
Manufacturer’s assurance to a buyer is warranty that a product or service is or shall be as
represented. It may be considered to be a contractual conformity between the buyer and
manufacturer entered into upon the sale of the product or service. A warranty may be implied or

it may be clearly stated. In broad terms, the purpose of a warranty is to create liability among the
two parties (manufacturer and buyer) in the event that an item fails.(Murthy & Djamaludin,
2002). Warranties are fundamental part of nearly all commercial and many government
communications that engage product purchases(Murthy & Djamaludin, 2002).

For the

evaluation of trade-offs between competing objectives or variables by using models warranty
management system is used. It is also used to provide information to management for the
designing of operational and functional strategies. Information that is related to warranty is
extracted from the business operations, organized, analyzed and used to assist managers in
decision making(Murthy & Djamaludin, 2002).
Customer Satisfaction
The research of customer satisfaction started as early as 1960’s(Cardozo, 1965).It is suggested in
the past studies that consumer satisfaction is a result of the confirmation or positive
disconfirmation of expectations and that customer dissatisfaction is a result of negative
disconfirmation of expectations(Oliver, 1980).To gain customer satisfaction many of the firms
must satisfy their employee’s needs and wants first. It is usually acknowledged from past studies
that when employee needs are being satisfactorily met then customer needs will satisfactorily
met(Gandhi & Kang, 2009).(McIlroy & Barnett, 2000)stated that to develop a customer loyalty
program an important concept of customer satisfaction must be considered. However Customer
satisfaction does not undertaking repeat purchases on the part of the consumers but still it plays a
very significant part in ensuring customer loyalty and retention. For satisfaction to be effective, it
must be able to construct loyalty amongst customers. Satisfaction is a vital scale of how well a
customer’s needs and demands are met while customer loyalty is a gauge of how likely a
customer is to repeat the purchases and engage in relationship activities. Loyalty is susceptible
because even if consumers are contented with the services they will continue to flaw if they feel
they can get better value, ease or quality elsewhere. Therefore, customer satisfaction is not an
accurate sign of loyalty. Satisfaction is important but not an ample condition of loyalty. In other
words, we can have buyer satisfaction without loyalty, but it is too difficult or even impossible to
have loyalty without satisfaction(Mohsan, Nawaz, Khan, Shaukat, & Aslam, 2011).
To gain a strategic advantage and survive in today’s ever-increasing competitive environment
one of the most powerful and potential weapons used by financial institution of 21 st century is

customer loyalty and retention(Mohsan, Nawaz, Khan, Shaukat, & Aslam, September
2011).After-sales service which is a part of consumer relationship management (CRM) helps to
boost a customer’s loyalty(Shaharudin et al., 2009).Customer satisfaction is interrelated with
trustworthiness of the customer and financially unwavering performance of the company
(Loveman, 1998).(Peterson & Wilson, 1992) said that every organization has to consider
customer satisfaction as the primary objective for success and growth. (Cronin Jr & Taylor,
1992)it is essential that service quality should be high for the customer retention and satisfaction
up to greater extent.An excellent supply system is mandatory to make sure that the product can
deliver to the customer at the right time and place. Companies have to improve their inventory
management by keeping good enough safety stock to avoid the hindrance in product delivery to
the customer. It must always keep the lead-time at the minimum possible as to meet the wishes
and requirements of the consumer. There is a need to respond within a reasonable and suitable
period to the consumer concerning the warranty claim. The company should not holdup the claim
made by a customer and try to fulfill it promises either by repairing or by replacing with a new
product. Continuous improvement is required after sales services through integrated functional
activities in order to produce high quality products that in turn can lead to customers’ high
satisfaction and confidence(Choudhary et al., Dec 2011).To retain the existing customers the
foundation of customer satisfaction is necessary(Guo, Xiao, & Tang, 2009). The customers who
are disappointed with the received services would not likely to have long lasting relationships
with the company(J.-S. C. Lin & Wu, 2011). Underprivileged services can also reason to
dissatisfaction, like inherently poor services or satisfactory level of services, which cannot attain
customer expectation may because of dissatisfaction in customers(Rust & Zahorik, 1993).
(Hallowell, 1996)also support that satisfaction and loyalty are related to one another.
(Wong, Chan, Ngai, & Oswald, 2009)proved that good relationship with customer have great
impact on customer loyalty. As (H. H. Chang, Wang, & Yang, 2009)analyze that there is no
impact on customer loyalty due to customer retention. The firm will find customers that are more
loyal due to the increase in improvement of customer satisfaction. The firm can attract more
customers with reference of loyal customer(khan, March 2012).The ultimate result of customer
satisfaction is through the recognition of quality conception and efforts to improve the quality;
the recognition of quality conception and efforts has caused high-quality service. The satisfied
customers are the assurance against the firm’s probable mistakes because the regular customers

ignore such mistakes just because of they have received satisfactory service before and now they
can disregard small mistakes of the firm and these customers will not switch to the competitor’s
product after confronting insignificant mistake.(Yalghouzaghaj & Shorbolagh, 2013). Kano
model is used to categorize and prioritize consumer’s needs and it is constructive as the needs of
the consumers vary from one another. The results from this model will be useful with prioritizing
actions to satisfy consumers. This model can also be used to identify customers categories based
on their needs comparative priority. After defining each part’s character based on the consumer
needs and common criteria such as gender and participation level, Kano model can be used again
in order to make a more complete description of parts priority(Yalghouzaghaj & Shorbolagh,
2013).
The author said about the customer satisfaction/dissatisfaction (CS/D) has focused on the
customer’s estimation of a particular transaction involved for a product or service(Holbrook &
Corfman, 1985). Preliminary customer satisfaction efforts by many service firms tend to focus on
tracking customer survey ratings over time or benchmarking them against competitors' ratings.
Customer satisfaction ratings become -- in effect -- a goal in their own exact. However, when
organizations try to incorporate the "voice of the customer" into the service delivery process,
they quickly discover a need for analytical information that predicts how service changes will
affect customer satisfaction, revenues and profits(Bolton & Drew, 1994).The objective is to
assess the performance of different organizational units -- where employee reimburse or
incentives may be coupled to changes in results managers should probably track perceived
service quality or a less explosive index(Bolton & Drew, 1994). The significant indicator of
company’s competitiveness is Customer Satisfaction(Lien & Kao, 2008). Technical and
functional quality has a different impact on customer satisfaction at different service categories.
Alternative on the nature of the relationship of quality dimensions and customer satisfaction have
a major impact due to differentiation. In utilitarian services the impact of technical quality on
satisfaction is no less than functional quality(Lien & Kao, 2008). Managers of utilitarian services
could consider investing more resources to increase customer satisfaction by improving core
benefits, especially when competitors are offering similar alternatives. To make up functional
quality managers must understand the specific resources, skills, and mindsets of service staff, so
that appropriate investment on quality enhancement can be made(Lien & Kao, 2008).

Customer Loyalty:
In emerging business, the competition is head to head, customer loyalty plays very crucial role to
achieve the competitive advantages(H.-H. Lin & Wang, 2006). Consumer loyalty has been
defined early that it is normally the keenness of customer to retain their relations with a
meticulous firm or service/product(Kim & Yoon, 2004). In the real time scenario loyalty is
defined as a customer loyalty to deal with a specific firm in the particular industry, buying their
products and services and referring it to colleagues(McIlroy & Barnett, 2000). Customer loyalty
is traditionally divided into two components, one is linked with behavior and the second one is
linked with attitudes(Guillén, Nielsen, Scheike, & Pérez-Marín, 2012). Customer loyalty is focal
point for several industry organizations(Vesel & Zabkar, 2009). The influence by management on
customer loyalty ensured the growth in the sales of a company(Gerpott, Rams, & Schindler,
2001). In emerging industry due to head to head competitions the loyalty of customers had
revealed as a main element in getting continue competitive advantage(H.-H. Lin & Wang, 2006).
Customer respect oriented business organization will attract and build up loyal consumers(Y.-H.
Chang & Chen, 2007).
For building competitive policies to successfully differentiate and win customer loyalty in the
competitive market it is very difficult to understand the customer psyche(Chen & Hu, 2010). For
consistent and continued existence and operating of firms business, customer loyalty is the
important element (Chen & Hu, 2010). Loyalty can be appraised by the intention of repurchase,
recommending the product/services to other and endurance towards value (Kim & Yoon, 2004).
To measure repeat purchase and tolerance for price customer loyalty is used(Auh & Johnson,
2005). The future possible revenue can be measured through the use of customer satisfaction
(Hauser, Simester, & Wernerfelt, 1994). (Wong et al., 2009)proved that good relationship with
customer have great impact on customer loyalty.
(Smith & Chang 2009) analyze that there is no impact on customer loyalty due to customer
retention. The firm will find customers that are more loyal due to the increase in improvement of
customer satisfaction. The firm can attract more customers with reference of loyal
customer(khan, March 2012).For each factor general requirements are compulsory because if
they are not facilitated, the customer will not buy that product(Yalghouzaghaj & Shorbolagh,
2013). Companies have customarily managed service delivery processes by manipulating

"objective" features that are characteristically considered by engineering or operational records,
such as the answer time of customer service representatives, repair clearing intervals, minutes of
system down time, or noise metallic readings on telephone cables(Bolton & Drew, 1994).Buyers
typically compare characteristics of comparable models of competing brands while taking
decision for the purchase of a product. It is very difficult, in many instances, to choose a
particular product exclusively on the basis of the product related characteristics such as product
price, particular features, perceived product quality and reliability, financing offered by the
manufacturer and so on, when competing brands are nearly identical(Murthy & Djamaludin,
2002).The loyalty of customers is the asset for the company and it ensures long term
development of a company(BRIMPONG, 2008).After-sales service which is a part of consumer
relationship management (CRM) helps to boost a customer’s loyalty(Shaharudin et al., 2009).

Theoretical Frame Work:

Warranty
Customer
Satisfaction

Customer Loyalty

Delivery

Chapter # 03: Methodology:
This research study will be helpful to know the impact of after sale services that how
customer perceive the warranty while spending money on durable items. This study will also
help the managers and business students of marketing department that what consumer thinks

about the after sale services. To analyze the result of research out comes the SPSS software will
be applied and statistical tools are applied to data collected from the targeted sample out of the
population.

Research Philosophy:
Three different philosophical paradigms are defined as
Positivism:
Positivists regard as that information can be based on what can be neutrally experiential and
experienced. Positivists observe the world as a assortment of visible events and facts which can
be calculated. Positivist study design is mostly based on deductive approach. It defines variables
for cram; forecast their relationship in the course of framing of hypotheses and analysis those
hypotheses.(Williamson, 2002) The positivism research is used for the quantitative research
method and this paradigm is also called scientific method.
Interpretivism:
This is an sunshade term which is essentially linked with qualitative research method.
Researchers who interpretivists support naturalistic enquiry as well as are alarmed with the
meaning. They believe that the shared world is interpreted or constructed by public and is
consequently different from the natural world(Williamson, 2002). The Interpretivism is also
constructivism. In this paradigm the theory is generated. This paradigm is used in qualitative
study. The intent of this paradigm is to take feedback from individual as this study is about the
generation of new theory so to keep and consider the every aspect every individual is kept
important in this study.
Pragmatism:
The final paradigm is normally linked with mixed method research. The aim of pragmatic
research is not to put back either of these approaches but relatively to draw from strength and
reduce the weakness of mutually in solo research studies and across studies(Johnson &
Onwuegbuzie, 2004) The pragmatism is associated with the mixed method research or a
combination of positivism and Interpretivism. In this paradigm the researcher follow both the
paradigm according to the situation and need.

The Research paradigm taken:
The paradigms which choose for my study is positivism as it is applicable to my study
and my study is based on quantitative technique. The reason for using quantitative technique is to
verify the theory. The previous study is also available on these variables which I have selected to
study so the positivism is used to verify the existing theory. The impact of after sale service will
be measured on the basis of customer loyalty. The study verifies the existing theory on customer
loyalty. The quantitative technique will be helpful for my research as my focus is on quantity and
to collect the data in the rating form so that the standard result will be available for further study
and it will explore further in detail.
Research Approaches:
There are there research approaches that are mainly used in research;
Induction:
Inductive approach begins with the particular instances and concludes with the common
statement or morality. Inductive logic is linked with the hypothesis generate approach to
research. Field effort and annotations occurs at the start and hypotheses are generated from the
analysis of the data composed(Williamson, 2002).
Deduction:
Deductive approach is associated with the hypotheses testing approach to outcome. With
the deductive approach the clash move from common principle to exacting instance(Williamson,
2002). The researcher measures the theory and rate it that up to what extent this theory works.
Qualitative Approach:
In qualitative research data are generally articulated in words. Data are classified and then
categorize and broad narrations are written telling the phenomena in great detail(Taylor, 2005).
Qualitative approach is used for the detailed studies in which data is collected through opened
ended questionnaire and interviews are recorded then data is transfer into meaningful form. In
this approach each interviewee is consider the important one because a detail study is conducted
in this method so that researcher can focus on every single aspect.
Quantitative Approach:
Quantitative research technique concerning the conversion of individuals experience into
categories predefined by the investigator(Jayaratne & Stewart, 1991). Quantitative figures are

used to demonstrate the relationship between the variables(Taylor, 2005). A close ended
questionnaire is designed and likert scale is used to record the data. This approach is used for
positivism paradigm. In that paradigm the data is collect which is quantifiable so that easily
identify how many respondent give the same answer.

Research Approach Taken:
The research approach which I have taken for my study is the quantitative
approach. The reason to select that approach is that this approach is used for positivism
paradigm. And positive paradigm is used to verify the theory. The topic which I have selected is
already research and the literature is available. To improve the previous studies I am using this
approach so that I can easily collect the data. The data collection method used for this approach
is easier than qualitative data. The analysis of the data is easier in this approach. The analysis is
conduct through the SPSS software which is the most popular software for the quantitative
approach.
Research Design:
In this phase of research design first of all the selected are of study is defined which is about the
after sale service. After sale service is the part of customer relationship management and plays an
important role in managing the relation with the customer. The reason to select that area is due to
the increase in the competition in home appliances sector of Pakistan. Companies are
differentiating them on these bases. Companies are trying to build the customer loyalty and use
after sale services to attract the customer towards their brand. In this study the loyalty of
customer will be evaluated during the purchasing decision. For this purpose the literature view is
conducted. The variables are selected from the past studies of the researchers from books and
articles. The dependent variable is major element of whole industry so this study is design to find
out how the customer is loyal to the specific product brand.
Data Collection:
The next step in research design is the collection of data. Two types of data are used to
collect the data. One is the primary data. This data is first hand and collected by the researcher
and the other one is known as secondary the data. In this research both types of data are used to
collect the maximum information. The literature view is used to present the secondary data and

identify the variables of the research and data will be used as reference. The literature view is
taken from the different articles of authors so that the research about the selected variables is
clarified and methodology of research is identified. The literature view is used for the support of
variables and to take guidance for further proceeding. The research in literature view is limited
and not enough to verify the area of research. The customer needs and wants are ever changing,
due to this factor it is compulsory to collect the new data about the selected variables to take the
current data about the variables, as the current demand of customer about after sale service is
increasing so to properly evaluate about the selected variables the first hand information will be
collected through the questionnaire. The questionnaire is the tool to collect the current data. The
target audience is the user of the home appliances. The both genders are involved in this research
as the customer who comes at the retail outlets of home appliances are the exact target market.
The data collected from them will be the exact source of findings.

Primary Data:
Primary data is known as the data which is collected for the first time. The primary data is also
known as first hand data. Primary data is important for the researcher as to find out the current
situation. The research needs the first hand data to present the current findings and views of the
selected target audiences of the sector. The variable in this study is about the customer
satisfaction and loyalty. The satisfaction level of customer changes with the passage of time.
Now the customer is educated and take information about the product and compare it with the
other available brand so it is very important to take the current data about the customer
satisfaction and loyalty that how the customers feel satisfied and being loyal of that brands while
buying the home appliances product.
Secondary data:
The data which is already available and related to the selected research topic is
known as secondary data. This type of data is collected from different articles available to take
information about the selected variables. Many researchers have research about the selected
variables. The secondary data is also very important to the research study as it is the supporting
of the data required for the study. The secondary data is from the different countries of the world
and also from different industries. So it is beneficial to come to know about the impact of after

sale services on the customer loyalty. The secondary data is also useful in hypothesis to check the
relationship in the variables whether there is a relationship between the selected variables or not,
so secondary data is also very important for the research study because it gives the better
understanding by comparing the previous studies and the current scenario of the customer
satisfaction and loyalty.
Sampling Technique and sample:
The random sampling technique will be use to collect the data regarding the impact of after sale
service. 3 to 4 question of every variable are designed and will be distributed in the questionnaire
format to the customer randomly. The purpose of selecting the random sampling technique is to
collect the data from every category of customer because electronic items are not purchased only
by the specific group of customer. The electronic items are the necessities of life and used in
every home such as refrigerator, room cooler and many other items. The questionnaire will be
float to customers visiting the electronic retail outlets so that the exact data will be collected from
the targeted people. The research will be specifically conducted in Lahore, Pakistan.
Treatment of Data:
The data collected from the questionnaire will be the primary source of data as it is first hand
data and it is very meaningful in the research as it gives the current scenario of the situation.
After the data collection the feedback or response from the target people will be analyzed
through the software in which the data will be entered. The data is collected in the quantitative
method and a five point liqert scale is used to collect the data in the quantitative form. For the
quantitative analysis the SPSS software is used and the 16 th version of the SPSS will be used to
analyze the validity and reliability. In data presentation some descriptive statistics are used that
shows the collected data and its graphical representation. The inferential statistics describe the
relationship between the independent and dependent variables. There are two independent
variables warranty and delivery which are the elements of after sale service and to check the
impact of independent variables on dependent variables the quantitative method will be applied.
For the data reliability Chronbach’s Alpha value is measured by using the SPSS software. The
result of Chronbach’s Alpha shows that either the data is reliable. The format for the
questionnaire is close ended. For the close ended questionnaire Liqert scale of five points is used.
The liqert scale is from strongly agreed to strongly disagree. Some statistical tools of software

are used to analyze the data which helps in representing the data in the tabular and graphical
from.
Ethical consideration:
The ethical considerations are also the part of research. Honesty is the element of ethical
consideration and it should always be in the mind of researcher because the purity of research
worth more than the blunder. It is very important to keep the element of honesty at every stage of
research either it is the collection of data or the analysis of the data. The researcher should be
unbiased so that the research objectives are achieved. Furthermore researcher should keep
openness in the mind while conducting the results. The results of this research will be open for
everyone. To show the legality of data will cause of being trust or authenticity of data. The
statistical tools results will be valid and more reliable for future researches.

Chapter #4: Analysis
Frequency Table of Age:

Age
Cumulative
Frequency
Valid

Valid Percent

Percent

18-20

1

.7

.7

.7

21-23

82

54.7

55.0

55.7

24-25

45

30.0

30.2

85.9

26-onwards

21

14.0

14.1

100.0

149

99.3

100.0

1

.7

150

100.0

Total
Missing

Percent

99

Total

Frequency Table of Gender:
Gender
Cumulative
Frequency
Valid

female

Percent

Valid Percent

Percent

24

16.0

16.0

16.0

male

126

84.0

84.0

100.0

Total

150

100.0

100.0

Frequency Table of Occupation:

occupation
Cumulative
Frequency
Valid

Missing

others

Percent

Valid Percent

Percent

22

14.7

15.9

15.9

businessmen

116

77.3

84.1

100.0

Total

138

92.0

100.0

12

8.0

150

100.0

99

Total

Frequency Table of Qualification:
qualification
Cumulative
Frequency
Valid

intermediate

Total

Valid Percent

Percent

15

10.0

10.1

10.1

110

73.3

74.3

84.5

others

23

15.3

15.5

100.0

Total

148

98.7

100.0

2

1.3

150

100.0

bachelors

Missing

Percent

99

TABLE of Demographic Profile

Respondents’ Demographics
Gender (N=150)
Female
Male
Qualification (N=150)

Frequency

Percentage

24
126

16.0%
84.0%

intermediate
bachelors
others
Age (N=150)

15
110
23

10.0%
73.3%
15.3%

18-20
21-23
24-25
26-onwards
Occupation (N=150)

1
82
45
21

.7
54.7
30.0
14.0

others
businessmen

22
116

14.7%
77.3%

Bar Chart of Occupation, Age, Qualification and Gender:

Demographic Profile of Respondents:
From above table, demographic analysis is used to draw an illustration of respondents’ characteristics.
From the demographic information, within the sample of 150 respondents, the percentages for gender are
16.0%of male respondents and 84.0 % female respondents who took part in the questionnaires. The
percentages for OCCUPATION are 14.7% of businessman respondents and 77.3% other respondents who
took part in the questionnaires. Most of the respondents were from age group 18-20 years old 0.7 % Most
of respondents were from age group 21 to 23 years old (54.7%) and remaining were from the age group
24 to 25 30.0% and from above 26 were 14.0 %. Moreover, Apart from that, in the qualification there are
four categories are defined Intermediate, bachelors and others the frequency ratio is (10.0%) and (73.3%),
(15.3%) out of 150 items from conducting survey and it is valid percentage. Because there is no missing
value and no invalid frequency after completion of frequency table we drag a Graph which shows
verification of frequency table.

Validity and Reliability:
Validity of data is checked through expert and face validity.
Table 1

Sr. No
1
2
3
4

Variable
warranty
Delivery
Customer satisfaction
Customer loyalty

Cronbach’s Alpha
0.696
0.738
0.738
0.687

Interpretation
The table shows that the reliability and validity of the dependent and independents variables. The
variables is reliable when the value of Chronbach’s alpha is greater than 0.7.The warranty is independent
variable and its value is 0.696 its show that the variable is reliable. The delivery variable is independent
variable and its value is 0.738 its show that the value is greater than 0.7 so it’s reliable variable. The
customer satisfaction is independent variable and its value is .738 its show that the value is greater than
0.7 so it’s reliable variable. The last is dependent variable is consumer loyalty its value is 0.687.

Histogram:
Fig.1

This is histogram of warranty variable which has data of 150 questionnaires and data is normally
distributed. In this graph mean is 3.59 and standard deviation is 0.891 and bell curved shows that data is
normally distributed

Fig.1.1

This is histogram of Delivery variable which has data of 150 questionnaires and data is normally
distributed. In this graph our mean is 3.57 and standard deviation is 0.892 and bell curved shows that data
is normally distributed.

Fig.1.2

This is histogram of customer satisfaction variable which has data of 150 questionnaires. In this graph our
mean is 3.80 and standard deviation is 0.888 and bell curved shows that data is not normally distributed.
Fig. 1.3

This is histogram of customer loyalty variable which has data of 150 questionnaires. In this graph our
mean is 3.53 and standard deviation is 0.88 and bell curved shows that data is not normally distributed

Scatter Plot:
Fig.2

The above graphic presentation of scatter plot shows the relationship between two scale variable. In fig. 2
the difference between linear and Quadratic is 0.001 which is less than 0.05 which shows that, there is a
linear relationship between warranty and customer loyalty.
Fig 2.1

The above graphic presentation of scatter plot shows the relationship between two scale variable. In fig.
2.1 the difference between linear and Quadratic is 0.01 which is less than 0.05 which shows that, there is
a linear relationship between Delivery and customer loyalty.
Fig 2.2

The above graphic presentation of scatter plot shows the relationship between two scale variable. In fig.
2.2 the difference between linear and Quadratic is 0.073 which is greater than 0.05 which shows that,
there is a nonlinear relationship between customer satisfaction and customer loyalty.

Correlation:
Fig.3
Correlations
Warranty
Warranty

Pearson Correlation

Customer Loyalty
1

Sig. (2-tailed)

.000

N
Customer Loyalty

.434**

Pearson Correlation

150

150

.434**

1

Sig. (2-tailed)

.000

N

150

150

**. Correlation is significant at the 0.01 level (2-tailed).

The above graphic presentation of correlation shows the relationship between two scale variable warranty
and customer loyalty. In fig3the Pearson’s test is calculated because these variable have linear relationship
between each other, r = .434 which shows the positive relation between warranty and customer loyalty
and the sig. is .000 which was less than 0.05 shows that there is moderate relation between them.
Fig. 3.1
Correlations
Delivery
Delivery

Pearson Correlation

Customer Loyalty
1

Sig. (2-tailed)
N
Customer Loyalty

Pearson Correlation

.513**
.000

149

149

.513**

1

Sig. (2-tailed)

.000

N

149

150

**. Correlation is significant at the 0.01 level (2-tailed).

The above graphic presentation of correlation shows the relationship between two scale variable Delivery
and customer loyalty. In fig3.1 the Pearson’s test is calculated because these variable have linear

relationship between each other, r = .513 which shows the positive relation between Delivery and
customer loyalty and the sig. is .000 which is less than 0.05 shows that there is week relation between
them
Fig. 3.2

Correlations
Customer
Satisfaction
Spearman's rho

Customer Satisfaction

1.000

.384**

.

.000

148

148

.384**

1.000

Sig. (2-tailed)

.000

.

N

148

150

Correlation Coefficient
Sig. (2-tailed)
N

Customer Loyalty

Customer Loyalty

Correlation Coefficient

**. Correlation is significant at the 0.01 level (2-tailed).

The above graphic presentation of correlation shows the relationship between two scale variable. In fig3.2
the spearman’s test is calculated because these variable have non liner relationship between each other, r
= .384 which shows the positive relation between customer satisfaction and customer loyalty and the sig.
is .000 which is less than 0.05 shows that there is strong relation between them

Regression Analysis:
Variables Entered/Removedb
Variables
Model

Variables Entered

1

Customer

Removed

Satisfaction,
Delivery,
Warrantya
a. All requested variables entered.
b. Dependent Variable: Customer Loyalty

Method

. Enter

Model Summary
Std. Error of the
Model

R

R Square
.591a

1

Adjusted R Square

.349

Estimate

.335

.72218

a. Predictors: (Constant), Customer Satisfaction, Delivery, Warranty
ANOVAb
Model
1

Sum of Squares

df

Mean Square

F

Regression

39.964

3

13.321

Residual

74.580

143

.522

114.544

146

Total

Sig.

25.542

.000a

a. Predictors: (Constant), Customer Satisfaction, Delivery, Warranty
b. Dependent Variable: Customer Loyalty
Coefficientsa
Standardized
Unstandardized Coefficients
Model
1

B

Std. Error

(Constant)

1.063

.295

Warranty

.080

.093

Delivery

.272

Customer Satisfaction

.321

a. Dependent Variable: Customer Loyalty

REGRESSION EQUATION:
Y = a + bx1 + cx2+dx4+ex5+fx6
Y = dependent variable

Coefficients
Beta

t

Sig.
3.600

.000

.079

.860

.391

.085

.275

3.194

.002

.103

.321

3.111

.002

a = constant
b = coefficient
x = independent variable

Hence,
Y = 1.063+ 0.080x1 + (-) 0.272x2 + 0.321x3
Y= 1.736
INTREPRETATION:
Concurrently multiple regression was conducted to examine the best predictors of impact of after sales
services on customer loyalty. The means and standard deviation and inter correlations can be found in the
table impact of after sales services on customer loyalty were not statistically significant because p>0.05.
The beta coefficients are presented in the last table. The adjusted R square value was .335 and impact of
after sales services on customer loyalty was explained by the model and our model is good fit according
to Cohen (1988), this is large effect in positive direction.

Chapter No.5:Discussion and Conclusion

On the basis of findings of the study it was concluded that after sales services affects the
customer loyalty. There are different factors in after sales services that put compulsion on
customer to retain with his loving product in any situation and do not switch either product
unavailable in market or short in market. The organization that put stress on after sales services
acquire number of loyal customers for their business futures. It was observed that the customer
prefer that how much an organization is giving him or her flexibility and saving his or her time
by facilitating them. They satisfied their customers Although the high satisfaction lead to the
high commitment towards the organization and result in the increasing the customer purchasing
behavior in that specific organization’s business , but due to economic price instability and heavy
rates people have to move towards other local products.
In this discussion explain impact of after sales services on customer loyalty. I select variable in
this study are warranty, delivery, customer satisfaction and customer loyalty. I check my
variables with the different articles of researchers and then make my study. After identifying the
problem statement I select these variables and make the literature upon these variables and some
others. 150 respondents selected by me to perform this specific task. The primary purpose of the
present study was to study the impact of after sales services on customer loyalty. For this
purpose the present study used quantitative research method to check the proposed model’s
variables like, delivery, customer satisfaction and customer loyalty in the context of Pakistan’s
business environment and the present study used population of customer which are committed
from a long time with one product in Pakistan. The sample size of the study was 150 customers

of different products. The literature review has presented the theoretical evidence from past
studies with regard to the link between HR practice and performance.

The present study has selected only four factors that affect each other delivery of product affects
a lot on consumer mind he forced to think that the organization is taking care about me and
organization get good image in mind of customer and leads customer satisfaction. When
customer will be happy leads to good word of mouth in market about the product features its
utilization and durability as well as add remarks in the worth of organization’s business
environment. Loyal customers are most likely to share their experience of product with other five
or six people around them. Similarly dissatisfied customers are more likely to convey another ten
people about their unfortunate experience with a specific company’s product. In order to realize
customer satisfaction, companies must be capable to develop and sustain long term relationships
with customers through satisfying several customer needs and demands which resultantly
encourages them to carry on to do business with the company on on-going basis (La Barbera, &
Mazursky, 1983).
A business that satisfies their customer’s needs will be unsurprisingly attain the loyalty of their
customers, thus resulting in recurrence business as well as prospective referrals.Loyal and
satisfied employees greatly achieved loyal and satisfied customers (Heskett, 1994).Data collected
from the respondents put in to SPSS software for further analysis. The whole methodology that
we used for analysis explained in this chapter.After filling the questionnaire from the
respondents, the data was prepared in the SPSS. First analysis that has been done was the
descriptive statistics. In which the descriptive summary of the data illustrated. The demographics
of the respondents also asked in the questionnaire. In which age, gender and qualification of the
particular sector includes. The summary of demographics shows that how much participants
participate in this activity and the responses of the respondents also involves in the descriptive
statistics. The means value shows that how much strong response about the questions gave by the
respondents. And maximum and minimum values show that how much people response positive
and negative.
After sale services gives the edge of security to the consumer to save their investment. The
ultimate purpose is identify the relationship of warranty and delivery service which are the

element of after sale service with customer loyalty to check whether customers are being loyal
due to warranty and delivery service.Most of the companies now a day try to build customer
satisfaction to increase the number of customer because a satisfied customer will become more
satisfied when the company meets the requirements according to the desired level.After-sales
service has emerged as a most important starting place of competitive manipulation, so firms
endeavor for competitive advantages with their after-sales service portfolio to make distinct
offers from competitor(Goffin, 1999). After the descriptive statistics the second portion of the
inferential tests started In which the Scatter plot, regression and correlation analysis made.
Regression test shows the relationship between the variables and multiple regressions was used
to check the impact of the independent variable upon the dependent variable and on the other
side the correlation explains the relationship of variables. Correlation also explains the predictive
statements of the constructs and also shows either acceptance or rejection of hypothesis.

Customer satisfaction does not undertaking repeat purchases on the part of the consumers but
still it plays a very significant part in ensuring customer loyalty and retention. For satisfaction to
be effective, it must be able to construct loyalty amongst customers. Customer loyalty is focal
point for several industry organizations(Vesel & Zabkar, 2009). The influence by management on
customer loyalty ensured the growth in the sales of a company(Gerpott et al., 2001). With the
help of Descriptive Analysis and Inferential analysis I conclude that descriptive and inferential
analysis that after sales services like warranty and delivery affects customer mind and has great
affect in positive direction about customer positioning. These findings shows that there were be
lots of other factors that effect on customer loyalty but in my research study I study the warranty
and delivery because these two factors leads to higher customer satisfaction and higher
satisfaction enhances sales and generate loyalty.

Impact of after sale service on customer loyalty

Dear Respondent!
We are the student of bachelors in business administration at Superior University Lahore,
and we are conducting a research on “Impact of after sale service on customer loyalty” in
electronic industry of Pakistan. The questionnaire will be used for research which is a part of
research paper. The objective of this survey is to identify the impact and verify the theory. You
are requested to give a few minutes to fill this survey.

Please tick the appropriate answer or fill in the box.
1. Name ___________________
2. What is your occupation? ___________________
3. What is your qualification?
Metric
Intermediate
Bachelors
Other
4. Age
18-20
21-23
24-25
26- onwards

Please place the numeric 1, 2, 3, 4 or 5 in the appropriate column to indicate the degree to which you feel it
describes you
SCALE
Strongly disagree
1

Somewhat
disagree
2

Sr.#

Statement

Neutral
3

Somewhat
Agree

Strongly agree
5

4

1

2 3

4 5

Warranty
1.
The warranty period strengthen my purchase decision
2.
The warranty period is the guarantee for the product quality
3.
I prefer to buy the products that are in warranty.
4.
The amount that I pay for the product should justify the warranty time
period.
Delivery
1.
Product delivery is a element that provide me relaxation while buying
electronic.
2.
I prefer free home delivery service.
3.
I usually buy electronic from outlets that provide home delivery service.
4.
The effective delivery service is additional benefit of a product for me.
Customer satisfaction
1.
The quality of product increase my satisfaction level
2.
I prefer quality of product instead of pricing
3.
The good services of product influence my satisfaction level
4.
The life span of a product affect my satisfaction level
Customer Loyalty
1.
2.
3.
4.

I always give feedback for the brand which I purchase
I purchased the electronic items of a specific brand
I recommend the electronic brand to others which I use
I will wait for the item of a specific brand

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