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An Analysis of the Satisfaction of Online Group Purchasing in Restaurant Sector: Groupon Hong Kong

Feon Yuen Higher Diploma in Internal Hotel and Tourism Management HTMi Switzerland

The primary research takes place in Groupon Hong Kong, an online website which offers discount for online shopping within a limited time by having a certain number of people (Groupon, 2012). The trend of online group buying has been emerging for a few years and still a popular topic for researchers worldwide (Abraham, 2012). Online group buying is a platform for one to receive special offer from different goods and services (Erdogmus and Ciceka, 2011). Consumer behaviour is the way of act, which can fulfil ones need within prediction (Schiffman and Kanuk, 2010). It is the study of the whole process of ones decision from buy and use to throw away a product or service (Hoyer and Macinnis, 2008). It involves making choices with more than one selection (Schiffman and Kanuk, 2010; Lantos, 2011). Everyone makes decisions daily but few consider the reasons behind (Schiffman and Kanuk, 2010). Understanding the reasons behind is crucial for proper marketing (Lamb et al, 2012). Satisfaction is one of the important elements directly influencing the purchase intentions (Bai et al., 2008). It is proven that retaining customer is more cost effective than attracting new one (Seo et al., 2008). It is, therefore, important to investigate what makes people satisfied within the decision making process. Despite lots of research has been done on online purchasing satisfaction (Belanche et al., 2012; McNamara and Kirakowski, 2011; Thirumalai and Sinha, 2011; Bharati and Chaudhury, 2004; Cheng and Huang, 2013), they are not discussing about the online group purchasing. Though a research use Groupon as an example to evaluate the marketing strategy for having online promotion (Lee and Lee, 2012), it is not target on the satisfaction perspective.

Furthermore, existing research discussed the impact of satisfaction (Finn et al., 2009; Wu, 2013). Little research has been done as there are vague explanations of satisfaction (McNamara and Kirakowski, 2011; Wang et al., 2001). Based on the research mentioned, current research helps to fill the void on how satisfaction affecting online group buying. Group purchasing online has been a trend in Hong Kong. Despite some people argue that the deal is a fraud, many people still buy dinning coupon online to enjoy discount. This phenomenon motivates the author to investigate the behaviour on the satisfaction get from online group purchasing.

Definitions of Satisfaction
Achieving customer satisfaction is essential to differentiate ones from its rivals (Deng et al., 2010). There are several definitions concerning customer satisfaction from different authors. Most of them relate satisfaction with the perceptions of customers. The drive for customer satisfaction is the perceived performance and customer value (Lim et al., 2006). Cochran (2003) defines customer satisfaction as variables to control customers perceptions. It is the final target of a business, which is an investment of a company where results can be seen usually in a long run, and each employee has a contribution to make it happen (Ibid). Oliver (1981, cited in Yoon et al., 2010) regards satisfaction as the emotional condition results from the pleasurable feeling of unsure expectations from the consumption experience. Satisfaction is strongly affected by value received from customer perceptions when buying a product (Lam et al., 2004 cited in Lewin, 2009).

Another definition is the level of contentment of need or target that obtained from a particular transaction between company and consumer (Sunder, 2011). Hill and Alexander (2006) state Customer satisfaction is a measure of how your organisations total product performs in relation to a set of customer requirements. It is therefore measured by how customers see the performance (Ibid). Satisfaction can split into two types, which are transaction-specific satisfaction and overall satisfaction (Jones and Suh, 2000). Even so, it was stated that the definition of satisfaction is not clear in various research which hinder the development to explore further in customer satisfaction (McNamara and Kirakowski, 2011; Wang et al., 2001). From the above definitions, only two of them clearly stated the satisfaction is a whole process experience that is Olivers (1981, cited in Yoon et al., 2010) and Hill and Alexandars (2006) version. Olivers version, however, was imposed in 1981, which does not match the field of online group purchasing. As a result, Hill and Alexandars (2006) version is the best to describe in relating to the e-commerce. Several models have been used to explain satisfaction. The following is going to use the disconfirmation of expectations model (Oliver, 1977 cited in Tse, 2003), conceptual model of the satisfaction formation process (Spreng et al., 1996) and three-factor theory (Matzler and Sauerwein, 1997 cited in Fuller and Matzler, 2008) to examine the process that result in satisfaction.

Disconfirmation of Expectations Model

Figure. Disconfirmation of Expectation Model (Walker, 1995)

In figure, the Disconfirmation of Expectations model suggests a comparison between two perceptions, which is the actual and standard results that lead to different judgment (Niedrich et al., 2005). Sweeney and Soutar (2001, cited in Lim et al., 2006) state perceived value consist of values in quality, mental, economic and social aspects. According to Yoon et al. (2010), perceived value influences both the pre-decision making and post-decision making phase by having impact on the decision making process, satisfaction and repurchase intentions respectively. Within the experience of consumption, generation of perceived value can be happened any time while satisfaction can only be created after the consumption (Sweeney and Soutar, 2001 cited in Lim et al., 2006).

It was argued by Olander (1977 cited in Yau and Yau, 1994) that it is possible that satisfaction can exist before consumption. For instance, low sale of a product may due to dissatisfaction of a products advertisement. There is a positive disconfirmation if performance betters than expectation and vice versa (Yi, 1990 cited in Hsieh et al., 2010).

Conceptual Model of the Satisfaction Formation Process

Argument is introduced by Spreng and Mackoy (1996) that Olivers model have limitations including desires have no linkage to satisfaction and expectations have no influence on perceptions. A model is induced from Olives Disconfirmation of Expectations Model to have a more comprehensive overview to examine satisfaction in figure (Spreng et al., 1996).

Figure Conceptual Model of the Satisfaction Formation Process (Spreng et al., 1996)

The model-introduced factors causing satisfaction can be divided into two parts, which are attribute satisfaction and information satisfaction (Spreng et al., 1996). Attribute satisfaction is the judgment of satisfaction from observing the nature of performance in a subjective manner (Oliver, 1993 cited in Spreng et al., 1996). The nature of performance not only affected by the product itself but also the entire experience (Spreng et al., 1996). Information satisfaction is the judgment of satisfaction from the knowledge, for instance advertising, received when making the decision which affect the perception and root the ground for certain expectation which influence the satisfaction level. The two types of satisfaction are driven by expectations congruency and desires congruency. Expectation congruency is the mental contrast between expectation and the actual performance while desires congruency is between desires and actual performance (Ibid). Satisfaction is directly influenced by the expectations

(Bosque et al., 2006). On the contrary, Shukla et al. (2010) argue that it is the information confusion instead of expectations has a strong influence on information satisfaction.

Three Factor Theory

Herzbergs two-factor theory consists of satisfier and dissatisfier to explain the customer satisfaction (Arbore and Busacca, 2009). Satisfier is the criteria to increase satisfaction whereas dissatisfier is the primary requirement to avoid dissatisfaction. Nonetheless, product should not be judged by such narrow attributes (Ibid). It is opposed for various reasons such as difficulty in using another method to generalise, too simple, without considering variance between individuals or situations (Matzler and Renzl, 2007).

The three-factor theory is derived from Herzbergs two-factor theory and is introduced by Matzler and Sauerwein (1997, cited in Fuller and Matzler, 2008) (Figure There are three factors comprise from delightful customers decision making which are basic attributes, exciting attributes and performance attributes as shown in Figure

Figure The Three-Factor Theory (Arbore and Busacca, 2009)

To begin with, basic factors, also known as dissatisfiers, are the fundamental elements. Secondly, excitement factors, also named satisfiers, are the items that enhance customer satisfactory towards the product. They are items that make people surprise. The last one is the performance factors, also regards as hybrids, is a component that may cause either satisfaction or dissatisfaction depends on the performance (Ibid). The relationship of basic and excitement factors is asymmetrical among performance and general satisfaction of customers (Deng, 2007). The performance factors have a linear relationship with performance and customer satisfaction in general. Thus, dissatisfiers are essential when there is low performance while satisfiers are important when there is high performance, vice versa (Ting and Chen, 2002 cited in Deng, 2007).

Generalization of Satisfaction on Online Group Purchasing

Research has been supporting the Disconfirmation of Expectations model as the chief one to assess the variance of expectation and satisfaction (Tse, 2003). Szymanski and Henard (2001, cited in Niedrich et al., 2005) support the model by confirming that one of the most closely related origins of consumer satisfaction is disconfirmation. Lin (2007 cited in Hsieh et al., 2010) proves the model to be suitable for studying the online purchasing of decision-making. Nonetheless, the model did not indicate the criteria as what the standard outcome should be (Hsieh et al., 2010). Moreover, it is argued by Spreng et al. (1996) that the Olives model did not take account of the information obtained from the product into the decision making process as a tool to achieve satisfaction and therefore proposed the model in Figure (Ibid). The two models both assess the satisfaction process. Unlike the other two models, the three-factor theory is solely targeted on the reasons behind which makes it not thorough enough when explaining the complicated decision making process. Hence, model from Spreng et al. (1996) would be the most suitable for interpreting the online group purchasing among the three models.

Satisfaction in Online Purchasing

Various researches have been delivered their contributions in the online purchasing area. In the view of consumer, Belanche et al. (2012) identify information satisfaction created through the web usability. Web usability includes the web design, interface quality, provision of information, and ease of use and perceptions of risks.

All this enhance the user experience in online purchasing and have a positive effect on consumer satisfaction. McNamara and Kirakowski (2011) evaluate on the information satisfaction is the user experience of technology. They discovered that previous research based on the feature quality while the recent ones are based on the consumer and product interaction, which is the user experience. Thirumalai and Sinha (2011) investigate into both the information satisfaction and attribute satisfaction and proved that all have a positive relation with customer satisfaction. Based on the existing research, the importance of information satisfaction is gaining popularity among different researchers as they are trying to find more information regarding the area. Nevertheless, Bharati and Chaudhury (2004) reveal that how information present does not affect satisfaction but the quality of information do. It is argued that the importance of attribute satisfaction should not be neglected and was pointed out by Cheng and Huang (2013). Emotions stimulate the satisfaction of customers, which in turn lead to purchase intentions (ibid). Using the suppliers perspective, Lee and Lee (2012) used Groupon to assess criteria needed for the online shopping promotion. Small to medium sized business required substantial

technology and financial support to compete with the large sized company in promotion online (Ibid).

Consequences of Satisfaction in Online Purchasing

In addition to the importance of information satisfaction, Finn et al. (2009) further discover the satisfaction that transfer into word-of-mouth using Olivers Model and proven that subjective judgment have direct impact on customer

satisfaction and helps to increase intention for recommendation. It shows that satisfaction is not the single reason for the creation of word-of-mouth. In contrast to recommendation, Wu (2013) evaluate the linkage between satisfaction and intention of complaint. Three factors that may pave its way to complaints are technology, credibility and fairness in human dignity. The consequences of satisfaction are two-folded. The level of satisfaction would determine the result of recommendation or complaint.

Research Background Groupon Hong Kong

In the past few years, the online group buying is gaining popularity in Hong Kong. According to research, Groupon Hong Kong is the most influential online group buying website in Hong Kong in 2011 (Experian Hitwise, 2011). An online group buying website is a platform for buyer and seller to make transaction with sufficient participation (HKTDC, 2012). There are different elements influencing the number of customers participate in the buying process. According to the survey conducted by HKTDC (2012), the majority of customers on the websites are price sensitive and level of discount is a crucial factor to attract them in decision making; more than half of the people make choice because of the necessity and redemption location of the goods; nearly half of the participants make transaction based on the credibility of the group buying website; around two-fifth of people make decision depends on the time limit of the deal. Survey shows that most of the participants are aged 20-39 (CNNIC, 2011 cited in HKTDC, 2012).

Instead of factors lead to satisfaction, the report account for the dissatisfaction factors on the websites, the priority concern is about the product nature, service quality as well as the discount and terms and conditions of the product (CNNIC, 2011 cited in HKTDC, 2012).

Conclusion and Recommendations

To conclude, this paper analyses satisfaction by comparing various definitions and models. Among all, satisfaction is a measurement of level of performance of the product in meeting customers expectations (Hill and Alexander, 2006). There are two types of satisfaction, which is attribute satisfaction and information satisfaction (Spreng et al., 1996). To better measure the satisfaction of online group purchasing in primary research, quantitative approach is carried out while listing out the steps to achieve validity, objectivity, and reliability. It also pointed out measures taken to overcome the ethic issues as well as the limitations to carry out the research. In the case study, Groupon Hong Kong is merely one of the online groups purchasing websites so the results collected may not be fully able in applying to all of the other similar sites causing generalizability issue. For future recommendation, satisfaction is only one factor that leads to online group purchasing. More factors can be explored to access the elements that attract people to have online group purchasing. Future research can be focused on the segmentation issue to discuss the appealing reasons on online group purchasing. As mentioned by Cheng and Huang (2013), further research can be done on attribute satisfaction to check its importance on online group purchasing.

When working on the online sampling, the key factor need to take into great consideration is the credibility of the results as the participants do not really care about the result of the research and the nature of internet encourages quick response which makes the answers to be short or inappropriate to generate for the research.

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