CHAPTER 2: LITERATURE REVIEW

2.1 Introduction

This chapter will give a summary of earlier studies on the variables affecting Foodpanda application
users' satisfaction. A literature review is a compilation of academically significant books and journal
articles that have been published on a particular topic of research. The structure for the studies that
make up the primary emphasis of the research outlined in this proposal was also introduced.

A literature review is important for:

 Describe the history of this research by summarizing the earlier journal publication.

 Organize the research into distinct categories and show how it has evolved over time in a
given field.

 Assess the issue from before and determine a solution.

The literature review's main goal was to compile research on the elements that affect users'
satisfaction with the Foodpanda app. A review of the literature has been done to determine the main
data gathering requirements for the secondary research that will be done.

An overview of the prior research is provided by a synthesis of that work. Materials taken from the
review will be utilised to analyse the variables influencing consumer satisfaction with the Foodpanda
application and given the background for defining the needs for data collection as well as developing
the data collection methods for the primary study.
2.2 Overview of Literature Reviews

Food delivery application is a model that has been linked in this research. Food delivery applications
are a new system that provides convenience to both vendors and customers. Food delivery
applications are becoming more popular as consumers use them to save time and energy when
purchasing food outside of their home or office. Customers can obtain food delivery applications via
smartphone or website. Consumers can download it and set it only once via smartphone. Meanwhile,
if a consumer wants to order for the second time, they must return to the website and enter their
information again.

Foodpanda is one of the most popular food delivery services among consumers. Customers can place
orders through the Foodpanda app or by visiting the website at https://www.foodpanda.my/.
Foodpanda also assists restaurants that want to use their service, with vendors registering at
https://www.restaurant.foodpanda.my/. Foodpanda operates in over 80 cities across Asia Pacific,
including Malaysia.

2.3 The Setting/Industry/Sector

Consumer's Perception on Online Food Ordering (Chaudhary, 2018)

The researcher study found that consumers generally have a positive perception of online food
ordering due to its convenience, speed, and ability to compare options. However, some concerns
were identified, such as issues with food quality, delivery time, and technical glitches. Trust in the
online platform and the reputation of the restaurant were also found to be important factors in
consumer decision-making.

Understanding Online Food Ordering: How the Process Results in Satisfaction of The
Customers (SIHIPMAN, 2019).

The purpose of this study is to identify the variables that influence customer satisfaction and future
behavior when buying food online. By offering convenience, transparency, and personalization, the
online meal ordering process can increase customer happiness. Customers may simply track their
orders, browse menus, and get real-time updates. Online ordering also gives customers the option to
customize their orders and bookmark their favorite orders for later use. Additionally, the procedure
lessens the possibility of human error, leading to more accurate orders. In general, internet food
ordering can result in a satisfying experience for the customer.

The Effect of Mobile Food Delivery Application Usage Factors on Customer Satisfaction (Ye
-Eun Song, 2017).

The study examines how usage factors of mobile food delivery applications affect customer
satisfaction. The research finds that ease of use, perceived usefulness, perceived enjoyment, and trust
have a significant impact on customer satisfaction. The study suggests that mobile food delivery app
developers should focus on improving these factors to enhance customer satisfaction.

The Relationship Between Food Delivery Apps Attributes Towards Customer Perceived Value
Among Young Working Adults in Shah Alam (Azizul, Albattat, & Shahriman, 2019).

The purpose of this study is to determine the relationship between the attributes of the food delivery
application and customer perception among young working adults in Shah Alam. The study
discovered that consumer perceived value was significantly positively correlated with app
convenience, app design, app trust, app loyalty, and app information quality. In other words, users
regarded an application to be more valuable when it was convenient, well-designed, reliable, and
informative. App loyalty, or how frequently users use the app, was also discovered to have a
favorable impact on perceived value. According to the study, meal delivery apps that place an
emphasis on these characteristics can increase customer value and satisfaction.

Key Success Factor of Online Food Ordering Service: An Empirical Study (Zulkarnain Kedah,
2015).
The research study identified several key success factors for online food ordering services. These
include website quality, ease of use, speed of service, menu variety, pricing, delivery service, and
order accuracy. Additionally, factors such as trust, reputation, and promotion were found to influence
customer satisfaction and loyalty. The study emphasized the importance of providing a seamless and
positive customer experience to drive the success of online food ordering services.
2.4 Theoretical Framework

The type of payment has an impact on consumer satisfaction.

The type of payment can influence consumer satisfaction. Different types of payment may have
different advantages and disadvantages in terms of convenience, security, and reliability. Consumers
may have their own preferences for payment methods, and if their preferred payment method is not
available, it can negatively affect their satisfaction. Additionally, payment methods that are
perceived as risky or inconvenient may also lead to dissatisfaction. Therefore, businesses should
offer a variety of payment options to cater to different consumer preferences and needs.

Food Variety has an impact on Consumer Satisfaction.

In food delivery application, there are many varieties of food that make consumer prefer to buy foods
through food delivery application rather than going out to buy it by themselves. To increase
consumer satisfaction in food delivery applications, it is important to offer a variety of high-quality
food options that meet consumer preferences. The quality of food is determined by both its
appearance and the raw materials used in its production, and consumers often make purchasing
decisions based on the appearance of the product.

Promotional types have an impact on consumer satisfaction.

Promotions are activities conducted by sellers to increase consumer awareness about their products.
Sales promotion is a type of promotion that includes tools such as coupons, cash refunds, price-offs,
premiums, and prizes. Previous research suggests that offers and discounts are effective in attracting
consumers to engage in online food ordering on a regular basis, indicating that types of promotions
can influence consumer satisfaction.

Consumer satisfaction is influenced by customer service.

Customer service is important to make your customer retain with your business and to grow your
business. Customer service plays a crucial role in influencing consumer satisfaction. It involves the
interaction between the seller and consumer, and can be conducted through various channels such as
phone, email, web, text message, and social media. Good customer service can differentiate a
business in the virtual world from its physical counterpart. It is also important in addressing
consumer concerns related to real-time support, returns, and replacements.

The hypothesis is based on previous research. Previous research indicates that not all factors have the
same impact on consumer satisfaction. As a result, the issue is not only identifying the relevant
factors, but also determining the relative importance of each factor. As a result, in order to answer
questions about the relative importance of each factor on consumer satisfaction and to determine the
level of consumer satisfaction with the Foodpanda application, the following and the conceptual
research model were developed:

 H1: Payment method has a positive relationship with consumer satisfaction.

 H2: Food variety has a positive relationship with customer satisfaction.
 H3: Promotional type has a positive relationship with consumer satisfaction.
 H4: There is a positive relationship between customer service and consumer satisfaction.

Payment methods

Food variety

Customer satisfaction
Promotion types

Customer service
2.5 Summary of Chapter

This chapter's research aims to identify the variables that affect customer happiness.
In the last chapter, we discussed six aspects that affect consumer happiness, but in this chapter, we'll
concentrate more on four of them: the variety of food, the manner of payment, promotions, and
customer services. The foodpanda application needs to concentrate more on these aspects as they
will help to satisfy the customer. The criteria are essential to finding the answer Foodpanda needed.
The elements can aid Foodpanda in improving its solutions and application.

The type of payment is the next factor that influences consumer satisfaction. Foodpanda accepts
three payment methods: credit or debit card, online banking, and cash on delivery. Foodpanda must
prepare an online method and cash on delivery for customers because each customer is unique. Some
customers prefer online banking because it is cashless, while others prefer cash on delivery. Some
customers prefer to pay by credit or debit card because it is more convenient to pay by wave.

Food variety is one factor that affects consumer pleasure. In addition to providing a range of meal
options, Foodpanda must guarantee the cuisine is of a high calibre. Foodpanda must ensure that the
restaurant uses high-quality ingredients and that the food's presentation on the app matches that of
the final product.

Types of promotion are factors that affect consumer pleasure. Consumers can be made pleased and
devoted to Foodpanda by promotions like coupons in order to receive more coupons. Foodpanda
needs to advertise more frequently at eateries that customers frequent since it may affect their
customer happiness.

Finally, customer service is one of the factors that influence consumer satisfaction. Foodpanda must
provide excellent customer service because customers appreciate it when customer service responds
to their questions in a courteous and polite manner. Foodpanda must train their customer service staff
to be friendly with customers in order for them to be satisfied with the service. All of the factors
must be thoroughly investigated in order to determine which are the most important factors
influencing consumer satisfaction.