International Business Management

Year: 2011
Volume: 5
Issue: 4
Page No. 200 - 208

Airline e-Ticketing Service: How e-Service Quality and Customer Satisfaction Impacted Purchase Intention

Authors : Teck-Chai Lau, Choon-Ling Kwek and Hoi-Piew Tan

Abstract: Competition among companies in the airlines industry is intensive due to the pressure to reduce costs and to enhance service to customers. Majority of the airline operators used their websites not only for the purpose of making available the company’s information but also to provide online e-ticketing service to their customers. This is one of the methods industry players employ to boost ticket sales. In addition, the online service also improves the way business transactions are conducted. The objectives of this study were to determine the relationship of e-service quality and customer satisfaction and to explore the relationship between customer satisfaction and purchase intention of airlines industry e-ticketing service. Convenience survey method was employed and a total of 305 useable questionnaires were utilized for subsequent analysis. Five dimensions of e-service quality were identified namely; ease of use, website design, assurance, responsiveness and personalization. Results from the multiple regression showed that all five e-service quality dimensions significantly contributed to customer satisfaction. Ease of use was identified as the most important contributor to customer satisfaction. Further analysis also revealed that customer satisfaction influenced consumers purchase intention of airline e-tickets.

How to cite this article:

Teck-Chai Lau, Choon-Ling Kwek and Hoi-Piew Tan, 2011. Airline e-Ticketing Service: How e-Service Quality and Customer Satisfaction Impacted Purchase Intention. International Business Management, 5: 200-208.

INTRODUCTION

A Nielsen global online consumer opinion estimated that >875 million consumers worldwide had experienced shopping through the internet (Nielsen, 2008). When Nielsen conducted its 1st survey into online shopping habits in 2006, only 10% of the world’s online population (627 million) had made a purchase over the internet. Within 2 years, this number has surged by approximately 40% to a staggering 875 million.

The same report also revealed that online shopping revolution has a marked effect on shopping for air travel. Internet shopper interest in buying airline tickets/reservations online rose 3% points from 2006-2008 and one in four online shoppers globally said he/she had purchased airline tickets over the internet in the past 3 months. In the case of Malaysia, the recent A Nielsen global online consumer opinion described that web-savvy Malaysians like online shopping especially for booking travel with airline tickets and hotel/tour reservations being the top picks. This represents a huge potential for airline industry players. On the other hand, it also represents a great challenge for the airline companies to re-look at how their websites could be further enhanced and for the e-ticketing service to be used as the engine for future growth. In Malaysia, the concept of e-ticketing was 1st initiated by AirAsia in 2001 and subsequently followed by Malaysia Airlines in 2005. There are many benefits of purchasing tickets over the internet. Consumers are able to procure lower ticket rates through e-ticketing as compared to purchasing tickets from travel agents.

The airline companies are also able to provide an effective distribution channel through the implementation of e-ticketing besides reducing the cost of issuing air tickets. There have been a number of recent studies on e-service quality with different variables and models proposed in different online market places and countries (Gwo-Guang and Hsiu-Fen, 2005; Lociacono et al., 2000; Liu and Arnett, 2000). Gwo-Guang and Hsiu-Fen (2005) tested the e-service quality with variables such as website design, reliability, responsiveness, trust and personalization on customer satisfaction and purchase intention in Taiwan online bookstores. Liu and Arnett (2000) identified five dimensions in their study which consisted quality of information, service, security, playfulness perceived by consumer and design of the website. Both studies utilized different service quality variables and explored different online business settings. However, none of these studies provided a clear view on the impact of e-service quality such as ease of use, website design, responsiveness, personalization and assurance on satisfaction towards purchase intention in the context of e-ticketing offered by airline operators in Malaysia. The purpose of this research therefore is to investigate the impact of e-service quality on customer satisfaction and subsequently, purchase intention of airline companies’ e-ticketing service in Malaysia.

Literature review: Many e-commerce businesses realize that the key determinants of success or failure are the quality of the electronic service (e-service quality) and not merely website presence and low price (Yang, 2001; Zeithaml et al., 2001). Moreover, previous studies have also revealed that service quality in online environment is an important determinant of an effective e-commerce (Yang, 2001; Janda et al., 2002). Increased e-service quality on the web could assist online companies to be more effective and appealing and subsequently help them to achieve higher level of customer satisfaction and retention (Gronroos et al., 2000). For online consumers, a higher quality e-service implied high standard of services (Yang, 2001). It is much easier to compare product technical features and prices online than through traditional channels and henceforth, e-service quality becomes a key factor for online customers (Santos, 2003). Zeithaml et al. (1985) definition of service quality is that quality is judged in terms of excellence and superiority. Despite the conceptual arguments regarding service quality, it is generally agreed in the literature that service quality is a multi-level and -dimensional concept that might mean different things to different people (Mersha and Adlakha, 1992; Dabholkar et al., 1996; Brady and Cronin Jr., 2001). Review of past studies revealed that e-service quality was developed from internet marketing and the traditional service quality literature. The concept of service quality in e-commerce can be defined as consumers’ overall evaluation and judgment of the excellence and quality of e-service offerings in the virtual marketplace (Santos, 2003). According to Zeithaml et al. (2001), service quality in the internet is the extent in which a website facilitates efficient and effective shopping, purchasing and delivery of products and services. The SERVQUAL model 1st developed by Parasuraman et al. (1988) has been widely tested as a means of measuring customer perceptions of service quality. The SERVQUAL model is consists of five dimensions namely tangibles, reliability, responsiveness, assurance and empathy. In past decades, SERVQUAL model has been tested for measuring service quality in e-commerce settings (Devaraj et al., 2002; Kim and Lee, 2002; Li et al., 2002; Kuo, 2003; Negash et al., 2003). More attention is needed in customer evaluation of e-services because methods of measuring service quality differ between e-commerce and physical marketplace services (Parasuraman and Grewal, 2000). The researchers also suggested that more studies are required on whether the definition and relative importance of the SERVQUAL dimensions will change when customer interact with technology rather than with service personnel.

Consistent with previous study, Van Riel et al. (2001) proposed that the SERVQUAL scale items needed to be reformulated before they can be used meaningfully in the online context.

Lociacono et al. (2000) created an e-service quality called WEBQUAL that consisted of twelve dimensions which are informational fit to task, interactivity, trust, response time, design appeal, intuitiveness, visual appeal, innovativeness, flow (emotional appeal), integrated communication, business process and substitutability. On the other hand, Wolfinbarger and Gilly (2002, 2003) proposed an e-service quality with four dimensions which comprised of website design, reliability, privacy and customer service. Van Riel et al. (2001) also carried out a research in e-service quality with three dimensions of core service, supporting services and user interface. Liu and Arnett (2000) identified five dimensions in their study which consists of quality of information, service, security, playfulness perceived by consumer and design of the website. Parasuraman et al. (2005) developed the e-SQ scale in their study on the e-service quality in which seven dimensions were identified; efficiency, system availability, fulfillment, privacy, responsiveness, compensation and contact.

A research by Gwo-Guang and Hsiu-Fen (2005) examined the relationship among e-service quality dimensions and the overall service quality, customer satisfaction and purchase intentions. Their research looked at service quality in the context of online bookstore in Taiwan. It proposed five dimensions of e-service quality which are website design, reliability, responsiveness, trust and personalization.

The results showed that reliability, website design, trust and responsiveness affect customer satisfaction and the overall service quality. Furthermore, customer satisfaction and the overall service quality were significantly related to customer purchase intentions.

The model proposed by Ribbink et al. (2004) focused on examining the dimensions of e-service quality, e-trust, e-satisfaction and e-loyalty in the context of online book and CD store. The findings showed that e-trust and e-satisfaction directly influence loyalty. The other dimensions of e-scape, ease of use, customization and responsiveness indirectly affect e-loyalty through satisfaction and e-trust.

Conceptual framework of the study: Based on past literature, the dimensions of e-service quality were reformulated in order to best fit into the purpose of this study. This research explored the hypothesized effect of e-service quality dimensions of website design, assurance, responsiveness, personalization and ease of use on customer satisfaction which in turn influences the online purchase intention. The dependent variable, purchase intention is the primary interest in this study whereas the customer satisfaction is positioned as the stage variable. The conceptual framework for the study was shown in Fig. 1.

Relationship between customer satisfaction and purchase intention: Purchase intentions are significantly affected by consumer satisfaction (Cronin and Taylor, 1992; Labarbera and Mazursky, 1983; Zeithaml et al., 1993). Oliver (1980) stated that customers form expectations about a product or service performance prior to purchase. In addition, Rust and Anthony (1993) noted that overall service quality and customer satisfaction significantly influence customer retention. The degree of satisfaction will also affect future purchases with overall satisfaction enhancing the probability of continuing the purchasing behavior. Many researchers have explicitly recognized the experiences of satisfaction to positively impact future purchase intention (Cronin and Taylor, 1992; Labarbera and Mazursky, 1983; Oliver, 1980; Zeithaml et al., 1993). However, according to Lee (2002) whether a customer finally makes a purchase on the website largely depends on the satisfaction that the customer feels towards the website. Cronin and Taylor (1992) proposed that consumer satisfaction has a significant effect on purchasing intention and the affection is higher than service quality through purchasing intention.

Fig. 1: Conceptual framework

Relationship between ease of use and customer satisfaction: Ease of use is a determinant of service quality (Dabholkar, 1996) and is decisive for customer satisfaction, since it enhances the efficiency of using the service (Xue and Harker, 2002). In addition, the perception of ease of use to a well organized and searchable website can also lead to increased satisfaction because it simplifies and expedites the performance of the online shopping activities. The easier it is to learn to maneuver on the internet and within the websites, the greater the perception of control over the process (Hoffman and Novak, 1996). Apparently, the availability of needed information and ease of navigation are the necessary conditions for satisfaction determination. Ease of finding and evaluating products through better search tools, navigation and faster checkout could reduce consumer search and switching costs. Therefore, it may lead to higher overall customer satisfaction.

Relationship between website design and customer satisfaction: According to Buxton, website design is about the user experience of the website rather than about the creation of products. Website design played an important role in how customers judge the website quality (Wolfinbarger and Gilly, 2000). Website design is also customers’ perception on the degree of user friendliness when using an online store services (Parasuraman et al., 1988). Zeithaml et al. (2001) asserted that the tangible elements of the online stores include website design and website usability. A well design website that is easy to use is the starting point to enhance users’ confidence towards the online stores (Madu and Madhu, 2002). Research done by Wolfinbarger and Gilly (2003) showed that website design is the main factor that influences customer quality judgments, satisfaction and loyalty towards the online stores. Other studies suggested that a better and beautiful website design is intrinsically connected to user satisfaction.

Relationship between assurance and customer satisfaction: One of the primary barriers to online shopping is the concern for security (Zeithaml et al., 2001). Assurance in virtual space refers to the degree in which customers trust the safety of the site being protected from intrusion and is related to the confidence that customers feel when purchasing online (Zeithaml et al., 2001). Ribbink et al. (2004) mentioned that assurance also refers to customers’ perceived security and privacy when using e-retailing services. According to the study (Ranganathan and Ganapathy, 2002), although there were advancements in internet security over the years such as digital signatures, certificates and cryptography, online shoppers were found to be concerned about security issues when purchasing products and services over the internet. Website assurance is expected to enhance customer satisfaction (Semeijn et al., 2005). According to Zeithaml et al. (2001), security is considered an important factor that affects e-satisfaction of online shoppers.

Relationship between personalization and customer satisfaction: Personalization is referred to as the customer perception of the degree to which an online store provides differentiated services to satisfy specific or different individual needs (Parasuraman et al., 1988; Yang and Jun, 2002).

According to Gwo-Guang and Hsiu-Fen (2005), offering customized products and recommendations that meet customers’ preference influences their satisfaction and purchase intention. Peppers and Martha (1993) proposed that personalization has largely been assumed to affect satisfaction by producing a more satisfactory transaction and over time as more satisfactory relationship. Gwo-Guang and Hsiu-Fen (2005) and Than and Grandon (2002) argued that the personalization dimension in the online store was not significantly related to overall service quality or customer satisfaction. These findings might indicate that customers might be concerned about their personal information being sold by online stores to other organizations without permission from customers.

Relationship between responsiveness and customer satisfaction: Responsiveness is one of the most frequently cited services quality dimensions that lead to satisfaction. According to Xue and Harker (2002), the responsiveness of web based services has highlighted the importance of perceived service quality and customer satisfaction. Yang and Jun (2002) also have the same findings indicating that responsiveness are considered important for both overall service quality and satisfaction. From Gwo-Guang and Hsiu-Fen (2005)’s research, they postulated that the dimension of responsiveness mildly affects overall service quality and customer satisfaction for online stores.

Besides, it is also discovered that customers expect high responsiveness from prompt delivery of products but might tolerate slower financial transactions if such transactions have decreased security (Van Riel et al., 2001).

Hypotheses of the study: Based on the studies of previous research, relevant hypotheses were developed. The following hypotheses were projected:

H1 = Ease of use positively influences customer satisfaction
H2 = Website design positively influences customer satisfaction
H3 = Assurance positively influences customer satisfaction
H4 = Personalization positively influences customer satisfaction
H5 = Responsiveness positively influences customer satisfaction
H6 = Customer satisfaction positively influences purchase intention

MATERIALS AND METHODS

Data collection: The primary data for this research were collected through a structured questionnaire to answer the research questions and objectives. The survey questionnaire consists of eight distinct sections each of which contains questions pertaining to different parts of the study. The survey questionnaires were administered using convenience sampling method to about 340 students from several private universities located in the Klang Valley, Malaysia. Ferber (1977) explains that using students sample is considered valid for exploratory studies. Participation was voluntary and no remuneration was offered. Subsequently only 305 questionnaires were judged to be adequately complete to be included for further analysis. Roscoe (1975) proposed that a sample size of >30 and <500 are appropriate for most research. Therefore, the final sample size of 305 respondents was considered adequate for this study.

Instruments: The measures used in this study were modified from previous research. The measures used to gauge assurance; personalization and responsiveness were adapted from Swaid and Wigand (2007) and comprised of 4, 3 and 5 items, respectively. The measurements for purchase intention (2 items) and website design (3 items) were adapted from Gwo-Guang and Hsiu-Fen (2005). As for customer satisfaction, the 3 items were taken from Yang and Jun (2002) and finally, ease of use (4 items) were adapted from Ribbink et al. (2004). Respondents were asked to rate on a 7-point Likert scale (1 = Strongly disagree to 7 = Strongly agree).

RESULTS AND DISCUSSION

Factor analysis: A varimax rotated principal component factor analysis was performed on the five dimensions of e-service quality (i.e., ease of use, website design, assurance, personalization and responsiveness) comprising of 19 items to define the underlying structure among the variables in the analysis.

Table 1: Factor analysis on the e-service quality questionnaires

Table 2: Reliability analysis

Based on the suggestion from Hair Jr. et al. (1998), only a loading of ≥0.5 on the factor was considered. The results for the factor analysis extracted five factors solution with eigenvalues >1 and the total variance explained was 50.389%. The KMO measure of sampling adequacy was 0.872 while the Barlett’s test of sphericity was significant (p = 0.000<0.01). The results of the factor analysis were shown in Table 1.

Reliability coefficient: Conbach’s alpha was applied to test the reliability of the questionnaire measurements. Reliability tests were conducted on five dimensions of e-service quality, customer satisfaction and purchase intention.

The reliability coefficient of the variables exceeded the minimum acceptable level of 0.7 which concurs with the suggestion made by Hair Jr. et al. (2006). The Cronbach alpha values were shown in Table 2.

Demographic profile of the respondents: The survey respondents include 50.8% male and 49.5% female. The age group of the respondents was as follow; 1.6% aged <18 years old, 71.5% were between 18-22 years old, 24.9% were between 23-27 years old and 2% were >27 years old.

Table 3: Demographic characteristics of respondents (N = 305)

Table 4: Result of multiple regression analysis
R2 = 0.583; F-value = 83.581; Adjusted R2 = 0.576; Significance = 0.000

The majority of the respondents (30.8%) purchased air ticket on a yearly basis and the most popular airline website frequently engaged in was AirAsia (67.2%). The detailed demographic characteristics of the respondents were shown in Table 3.

Hypotheses testing: Multiple-regression analysis was used to assess the direct effect of the five dimensions of e-service quality of ease of use, website design, assurance, personalization and responsiveness on customer satisfaction. The results were shown in Table 4. The significant value for all the independent variables website design, ease of use, assurance, personalization and responsiveness were <0.05. Furthermore, the β-coefficient for all the variables showed a positive signs indicating positive influence of the e-service quality dimensions on customer satisfaction.

Table 5: Result of bivariate regression analysis
R2 = 0.359; F-value = 53.185; Adjusted R2 = 0.357; Significance = 0.000

Therefore, hypotheses 1-5 were accepted. The most important contributor to customer satisfaction was ease of use followed by responsiveness. The least important contributor was personalization. The value of R2 (0.583) implied that this model explained about 58% of the total variance in customer satisfaction. To assess the relationship between customer satisfaction and purchase intention, a bivariate regression analysis was used. The result shown in Table 5 showed that customer satisfaction positively affects purchase intention. Therefore, hypothesis 6 was also accepted. The value of R2 (0.359) implied that customer satisfaction explained about 36% of the total variance in purchase intention.

DISCUSSION

The results of the research in relations to the research hypotheses were shown in Table 6. As the online market emerged both researcher and practitioners have called for a set of reliable and valid service quality gauges in the e-commerce settings. The online service quality measure developed in this study is designed to provide an effective tool to assess Internet based service quality in the online air-ticketing environment. To enhance customer purchase intention, online stores should develop marketing strategies to better address website design, assurance, ease of use, personalization and responsiveness, since these factors significantly affect customer satisfaction towards online purchase intention. Ease of use significantly affects customer satisfaction of online ticketing. This is consistent with Ribbink et al. (2004) earlier research. Customers require easy access, good navigational quality with well-organized web structure to make it easy for them to surf and do their business transaction. Complicated procedures may lead to frustration. Ease of use is found to be the strongest dimension that affects customer satisfaction. In the context of web-based market, the easy to navigate feature is essential to attract both experienced and new online customers. Customers grant priority to the on screen information concerning product or services. Airline companies are recommended to simplify the information and the navigation of their websites. Since, the web functions as an information system, the organization and structure of online catalogues should be easy to follow and navigate.

Table 6: Summary of results in relation to the research hypotheses

A well-designed navigation structure can facilitate consumers’ perceptions of online control and enjoyment. Moreover, a good website should always clarify the meaning of interactive messages in order to facilitate comments from respondents. Consumers will often feel frustrated and even elect to terminate the transaction when they encounter confusing and slow processing sites. There is also a significant positive relationship between website design and customer satisfaction. The result is a confirmation from earlier research by Wolfinbarger and Gilly (2003). They found that website design is a strong factor in influencing customer satisfaction, quality judgment and loyalty towards online retailers. Website design plays a central role on transforming information searchers into online buyers. Thus, it is recommended that airline companies fully utilize their website to service the need of the information searchers. For example, airline companies could use the FAQ section on their website to address information searcher’s primary concerns such as security risk, on-time delivery and return policies. The website design dimension shows that there is a need to develop user friendly websites which will ease consumer purchasing and searching, thus creating a suitable framework for the creation of higher level satisfaction and purchase intention. Website design should not be ignored. It is an important means to provide customers usefulness and ease of use during online transaction processes. By improving the aesthetic features of the websites, airline companies can draw attention from potential customers. Airline companies are also recommended to provide brief and easy to understand information on their websites. When customers encountered impersonal or difficult to understand situations on the web, they might be discouraged and this might result in reluctance to subsequently purchase online.

Assurance is also shown to be an important contributor towards customer satisfaction. Airline companies are recommended to improve the level of credibility and security since, this variable significantly affects customer satisfaction. Airline companies should upload clear defined security policies on their websites concerning transaction and privacy security to gain credibility as security had become a matter of anxiety among consumers in the online transaction. According to Swaid and Wigand (2007), personalization was found to affect customer satisfaction. This is supported in the current research. From the airline companies’ perspective, it is paramount to understand passengers’ specific needs and therefore, provides personal attention to that need in order to increase satisfaction.

Personalization construct affects directly customer satisfaction. Airline companies should focus on providing tailored service for their customers to improve their satisfaction. Online customers’ might be unwilling to trade security with personalized offers and services. Therefore, airline companies should carefully manage customer personal information while delivering customizes service. Besides that the companies should also ensure that the personal information of the customers is well protected as research shows that customers are concern about the misuse and abuse of their personal information.

From the study, it was also discovered that Malaysian consumers value websites that are well organized have search and comparison features associated with high quality information and responds efficiently to customer’s questions. A high level of responsiveness has been found to affect customer satisfaction. This is consistent with prior studies by Swaid and Wigand (2007) and Gwo-Guang and Hsiu-Fen (2005). Responsiveness was found to affect customer satisfaction significantly. To provide speed and prompt response, airline companies are recommended to provide proper training to their employees as prompt training prepares the employees with the knowledge and ability to respond to customer request promptly and accurately. Such superior quality e-service meets the customer expectation resulting in satisfaction that influences customer intention to purchase. Thus, airline companies can emphasize the benefits associated with online e-ticketing such as saving time, depth of information and solving immediate needs.

Limitations and future research: Several limitations in this study are related to the sample of research and research design. University students were selected as the respondents for this research and might not be representative of the Malaysian population as the majority of the respondents are within the age of 18-22 years old. Future research should widen the sample reach to include a more representative cross sectional of the Malaysian population and to include senior citizens and the professionals. The study is also based on cross-sectional data that is only capable of revealing the net effect of predictor variable towards a particular criterion variable at a specific point in time. Longitudinal study which can capture the temporal dynamics of perception change that affect customer satisfaction and purchase intention is proposed to be adopted in the future research in order to help researchers to identify the cause and effect relationships among the various constructs.

As the airline industry is getting more global with consumers’ from different diverse background and nationality engaging in the e-ticketing purchase, it might be pertinent for a cross cultural research to be conducted. Understanding the online purchase behavior of consumers from across national boundaries would be useful in tapping into this vast market. The current study might need to be expanded further as the importance and possible meaning of website quality may differ across cultures (Gefen and Straub, 2000).

CONCLUSION

The findings suggested the necessity to enhance several e-service quality dimensions to ensure high level of customer satisfaction and purchase intention. These findings were useful especially for airline operators that rely upon online e-ticketing service to improve sales.

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